Is It Time To Be Fearful Or Greedy In The Real Estate Market?
Categories: Buying Real Estate, Real Estate News
hiAs with most investments, I guess it depends on your perspective. Since real estate is local, I will include some of the comments made at the National Association of Realtors’ Midyear Legislative Conference in Washington DC last week.
Although national median home prices will fall, Lawrence Yun, NAR’s chief economist expects some areas will see a growth in median home prices. He is bullish on the following areas:
- Texas because of job growth and amount of affordable housing.
- Mountain states of Colorado, Montana and Idaho because they have solid sales growth and prices are strengthening.
- Boston, a region where prices had been falling, because an uptick in job growth makes him believe
prices will increase.
Since there is so much negative news about the housing market, I was impressed with Mr. Yun’s ability to find positive news among the doom and gloom.
- He noted that Detroit, having had prolonged job losses, has seen the pace of job loss decreasing and home sales activity increasing.
- In areas where high sub-prime lending has created havoc on the housing market, such as Sacramento and Riverside Counties in California, the 20% price decline over the last 12 months has been a fast price adjustment versus previous housing cycles where prices declined very slowly.
- He also stated that although states like Arizona, Nevada, and Florida had seen tremendous growth and now
have a lot of inventory, baby boomers that are retiring want to head towards the sun so all of these states are projected to rebound. States like Nevada and Florida have the added advantage of not having a state income tax, a valuable perk for retirees.
Warren Buffetis famous for his investment acumen and his words of wisdom regarding how Berkshire Hathaway succeeds, “We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful”. Hmmm, maybe its time to buy residential real estate!
It does look like the Phoenix area is starting to find the bottom. The East Valley inventory is about 8 months and the bank owned inventory is about 4 months. Let’s hope things turn around soon.
That is great news, Todd. How is the employment market in Phoenix? Have wages kept up with housing prices? We are finding that to be a major issue in the Miami area.
Saskatchewan real estate has a lot of potential. The province has some of the richest deposites of uranium, oil, and diamonds in the world.
Is real estate selling in Saskatchewan for mineral rights, then? How is the housing market there?