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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Divining the movement of the real estate market... Posted by Ward-CA- on June 06, 2003 at 7:03 AM In Reply to: PREVENTIVE INVESTMENT posted by JOHN - CA on June 05, 2003 at 12:33 AM : Ward Guru, : Thanks for all the info. You've really been motivating my wife & me to try to invest. : What can you comment us all on investment strategies to take during the real estate bust which is bound to come. We're pass the 10 year real estate market up/down cycle. My hunch feeling is the same sending chills up my spine like during the internet bubble(too naive). : Would you continue to buy/resell homes or? How would you shift your buying/reselling homes and. You've been investing during the bad days of 91-93 after the real estate bust of the late 80s. what pattern(s) do you see change? : Thanks for your many insights. : John - CA =•=•=•=•=•=•=•=•=•=•= John, Think of the real estate market as a herky jerky movement that at times favors Sellers, while at other times Buyers, or sometimes neither—when it’s neutral. I actually favor the Neutral market because it seems I can’t win for losing in the buyers or sellers markets. That’s because I flip most of my foreclosure buys. So if I’m in a Seller’s market, like the present, it’s real tough to find a good deal to buy, but I can flip deals in this market incredibly fast. But when I’m in a Buyer’s market ugh, it takes me months to resell a deal, sometimes approaching 10 months! The smoothness of the Neutral market is hard to beat. It’s not too tough to buy or sell, WOW! You put you finger on our current Seller’s market—it has persisted far longer than I’ve ever experienced before! Beginning in the 2nd quarter of ‘96 to the present is quite a long cycle. It’s so long that a lot of foreclosure buyers haven’t experienced any other market, and so think this is going to last forever. And so they continue to buy like maniacs. Guys like me, with long memories, are much more goosey, thinking it can turn down at any time. Yet time after time it doesn’t budge. Another factor to keep in mind is our market is currently stratified—much like the layers of a wedding cake. The largest, bottom level is our entry level market. And right now it’s going gangbusters. The next mid-level is our move-up level and it’s just about dead and the top level is our luxury level and it is dead, nary a twitch in that market. The bottom level makes up for half the whole cake and the other two levels make up the other half. So we’re really limping along in this half market that’s going to collapse when interest rates and/or unemployment start to rise. I personally thought the Iraqi War would deliver the coup de gras. I was positive the uncertainties caused by the war would be enough to cause buyer’s jitters and precipitate the demise of the entry level boomlet. No such luck. The war was over so fast we didn’t have time to agonize over it. And look how fast they pulled our men out and shipped them home! Hope this helps. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : Ward Guru, : : Thanks for all the info. You've really been motivating my wife & me to try to invest. : : What can you comment us all on investment strategies to take during the real estate bust which is bound to come. We're pass the 10 year real estate market up/down cycle. My hunch feeling is the same sending chills up my spine like during the internet bubble(too naive). : : Would you continue to buy/resell homes or? How would you shift your buying/reselling homes and. You've been investing during the bad days of 91-93 after the real estate bust of the late 80s. what pattern(s) do you see change? : : Thanks for your many insights. : : John - CA : =•=•=•=•=•=•=•=•=•=•= : John, : Think of the real estate market as a herky jerky movement that at times favors Sellers, while at other times Buyers, or sometimes neither—when it’s neutral. I actually favor the Neutral market because it seems I can’t win for losing in the buyers or sellers markets. : That’s because I flip most of my foreclosure buys. So if I’m in a Seller’s market, like the present, it’s real tough to find a good deal to buy, but I can flip deals in this market incredibly fast. But when I’m in a Buyer’s market ugh, it takes me months to resell a deal, sometimes approaching 10 months! : The smoothness of the Neutral market is hard to beat. It’s not too tough to buy or sell, WOW! : You put you finger on our current Seller’s market—it has persisted far longer than I’ve ever experienced before! Beginning in the 2nd quarter of ‘96 to the present is quite a long cycle. It’s so long that a lot of foreclosure buyers haven’t experienced any other market, and so think this is going to last forever. And so they continue to buy like maniacs. Guys like me, with long memories, are much more goosey, thinking it can turn down at any time. Yet time after time it doesn’t budge. : Another factor to keep in mind is our market is currently stratified—much like the layers of a wedding cake. The largest, bottom level is our entry level market. And right now it’s going gangbusters. The next mid-level is our move-up level and it’s just about dead and the top level is our luxury level and it is dead, nary a twitch in that market. : The bottom level makes up for half the whole cake and the other two levels make up the other half. So we’re really limping along in this half market that’s going to collapse when interest rates and/or unemployment start to rise. : I personally thought the Iraqi War would deliver the coup de gras. I was positive the uncertainties caused by the war would be enough to cause buyer’s jitters and precipitate the demise of the entry level boomlet. No such luck. The war was over so fast we didn’t have time to agonize over it. And look how fast they pulled our men out and shipped them home! : Hope this helps. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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