Bottoming Out
May 7, 2008
Almost every day as I read the newspapers and listen to the TV, there will be an article in print or a question of some financial professional dealing with "the bottom". Have we reached "the bottom"? Is the stock market at "the bottom'? Has the credit crunch "bottomed out"? Has the housing price decline reached "the bottom"?
In my 33 years as a real estate professional, I cannot remember a time in which the media was so focused on "the bottom". Is it because buyers of real estate and of stocks and bonds want assurance that they will not lose money? Certainly none of us wish to lose money, but we do purchase all sorts of goods and services that we want or need that do not give us a return on our investment in them. I think of jewelry, furniture, appliances, clothing, etc. It has long been a mantra that when you buy a new car, the minute you drive it off the dealer's lot, it is worth less money than your purchase price. These items are seemingly not in the realm of the "bottom out" before a purchase is made.
The argument is made that these are essentials. I probably have a biased view, but I believe that for us human beings, housing a pretty essential. So the reason for the "bottom out" is related to categorizing housing as an investment.
In the course of my life, my family has bought and sold five houses. We presently live in one, of the other four, we lost money on two, we still own one and we made money on the fourth. Of all of them, they were purchased because they met our needs and our pocketbook at the time of purchase. They all gave us great perks in friends and in creating the surroundings that met our personal tastes.
I guess I wish that there could be more focus on the benefits of home ownership and less focus on need to have assurance that your purchase will be made at "the bottom".
Almost every day as I read the newspapers and listen to the TV, there will be an article in print or a question of some financial professional dealing with "the bottom". Have we reached "the bottom"? Is the stock market at "the bottom'? Has the credit crunch "bottomed out"? Has the housing price decline reached "the bottom"?
In my 33 years as a real estate professional, I cannot remember a time in which the media was so focused on "the bottom". Is it because buyers of real estate and of stocks and bonds want assurance that they will not lose money? Certainly none of us wish to lose money, but we do purchase all sorts of goods and services that we want or need that do not give us a return on our investment in them. I think of jewelry, furniture, appliances, clothing, etc. It has long been a mantra that when you buy a new car, the minute you drive it off the dealer's lot, it is worth less money than your purchase price. These items are seemingly not in the realm of the "bottom out" before a purchase is made.
The argument is made that these are essentials. I probably have a biased view, but I believe that for us human beings, housing a pretty essential. So the reason for the "bottom out" is related to categorizing housing as an investment.
In the course of my life, my family has bought and sold five houses. We presently live in one, of the other four, we lost money on two, we still own one and we made money on the fourth. Of all of them, they were purchased because they met our needs and our pocketbook at the time of purchase. They all gave us great perks in friends and in creating the surroundings that met our personal tastes.
I guess I wish that there could be more focus on the benefits of home ownership and less focus on need to have assurance that your purchase will be made at "the bottom".
posted by shirley harry at 9:56 AM
0 Comments:
Post a Comment
<< Home