Housing and mortgage...random thoughts
- At 11:31 PM on Monday night, there are: There are 16,981 active homes in San Diego, CA. per ziprealty. At what time this week (give day and time), do you think that San Diego will go over 17,000 properties? I would do Orange County, but ziprealty hasn't split OC/LA up...so the number sits at over 72,000. I'm going to say Tuesday at 3pm, we will go over 17,000.
- I was 'out and about' quite a bit this long weekend. Made it down to the Gaslamp in San Diego. On one corner there were 4 sign 'spinners' peddling condos. I saw 2-3 others on various downtown corners. Has anybody ever bought a condo because of one of these guys? Maybe it's just me, but a condo starting at 300k is not an 'impulse purchase'. If somebody was spinning a sign for a $2.50 slice of pizza, I think it might work. Condo's....not working for me. Not to mention the fact there is a real estate office on every block, and condo's going up all over "East Village". Even if I did want to buy a condo....those signs are merely pointing me in the direction of about 10 places where I could 'buy' one.
- Why is there a silent ‘T’ in the word MORTGAGE???? (let me clarify…this is more of a ‘joke’ than a real question. Back in a training class a while ago, the instructor asked if there were any questions…somebody raised their hand, and asked that question. It was much funnier if you were there.) Thanks to all the people who e-mailed me, or posted the correct answer about the french origins of the word.
- Read this piece of work that was e-mailed to me by a broker. I think they got the roles reversed....what do you think?!?!?
CONTRARY TO POPULAR BELIEFIT PAYS TO BE A CONTRARIAN. Sir John Templeton was known as the Dean of Investing, and he was a classic contrarian. Mr. Templeton said to buy when things looked most pessimistic and sell when the masses felt most optimistic and his attitude paid off. He began his Wall Street career in 1937, created many of the worlds largest and most successful international investment funds, and is now a full time philanthropist at age 92.
Some recent examples - stocks were on fire in 2000 and almost everyone was buying, but the market went the opposite direction from the herd. And now over the past four years the media has warned of a housing bubble, but home prices have done very well across the country; rewarding those who bought. With Housing Starts numbers coming out with a bang this past week and the report being higher than expected, it is a clear indication that the demand for housing is still strong. So, what about all this housing bubble hype?
Well, if Joe Kennedy father of former President John F. Kennedy were still alive, it is pretty clear that he would agree and say that the hype is clearly just that, hype. If we could ask this legendary contrarian and one of the most successful businessmen in history what he would do given the current Housing Starts number and all the bubble hype being published by the media, Mr. Kennedy would probably runnot walkbut run to a local real estate office and invest in real estate.
Let's take a look at why Mr. Kennedy would probably feel so strongly about purchasing a home. Joe Kennedy attended Harvard College and became a highly successful entrepreneur with an eye for value. He multiplied his fortune through stock speculation and did so by investing with a very contrarian mindset. In the early to mid 1920s the majority of the population was reluctant to invest in the stock market. However, Mr. Kennedy became an expert in dealing with a stock market that was unregulated and even opened his own investment company during the bull market of the 1920s. Joe clearly saw an opportunity and with his keen eye for value, invested in the stock market. By being smart, going against the grain of the majority, and not buying into fear, he bought with confidence and made millions by doing so.
But one day, his local shoeshine boy gave him a tip on a stock to buy. Mr. Kennedy immediately cashed out his multi-million dollar gains and got out of the market. He realized that if the market were so oversaturated that even the shoeshine boys were giving out stock tips, it was time to get out. And thats exactly what he did, just months before the stock market crash in 1929. Looking back, Mr. Kennedy based his investments on facts and statistics, not on fear and hype.
And when the housing bubble hype began four years ago, many individuals refused to base their decisions on hypeand have seen sizeable gains with their real estate investments. On the other hand, those who put off purchasing real estate based on the fear induced by the media most probably regret their decision. If you have been putting off the purchase of your dream home, dont base your decision on fear and hype, meet with your trusted mortgage professional and get the facts about your local real estate market.
Uh...maybe I missed something, but I thought the popular opinion was that you "can't lose" with real estate? I had no idea the media has been saying there was a housing bubble for the past 4 years. Heck, the stories are JUST starting to roll in over on Ben's blog. Remember, the media is a lagging indicator...and many brokers will say anything to get a commission. The fundamentals in this story are correct, but they are having an identity crisis and they got their roles mixed up. The contrary people would be 'selling' into all the 'buying' frenzy.
I know there is quite a bit of e-mail for me in my inbox, just bear with me, and I will get replies out. The forums are doing excellent! We hit the 200 member barrier! There are almost 150 topics and 900 posts! Lots of good info in there. If things are slow on the blog, be sure to check out the forums. Comments, feedback, and donations ;) are always welcome and appreciated!
I look forward to the comments on this one. Don't forget to make your guess on San Diego going over 17,000 properties!
I am going to keep making my posts over here, but most of the comments are happening at the new site. Go to...
...if you would like to see more comments and activity. Don't forgot to check out the activity in the FORUMS!