Dennis Norman
By:Dennis Norman
If you have been paying any attention to this blog over the past month or so you will know that I have discussing the idea that the positive numbers are being reported lately on the housing market may be nothing more than a false bottom and not a recovery.
There are,of course,differing opinions such as that of Robert Allen,the author of “Nothing Down”as well as a couple of other books. I received a press release this morning indicating that Robert Allen announced today (wait a minute,what time does this guy get up? I got the email at 5:10 am central time and it came from Orlando,Florida so it was 6:10 am there …hmm,wonder who he “announced”this to at that time of the morning? Anyway,back to the story) that “in his best estimation we will hit a bottom to the real estate downturn this coming October and that now is a good time to buy.”
Before I go further,let me say,I do hope Allen is correct,I’m not a doomsdayer,I just have concerns about mortgage delinquency rates,foreclsoure rates and unemployment to name a few. Allen says “what’s changed from a few months ago is that inventory has begun shrinking,bidding wars have started across the country,and prices are finally starting to rise in many markets. I’m encouraging all my clients to start looking for properties again.”
Robert Allen says recent facts seem to support his and the media’s claim that not only is the recession over but the real estate market has hit a bottom with some areas of the country even posting average price increases. According to the Winans International Real Estate Index (WIREI),which measures U.S. home prices from 1830 to present,all regions of the U.S. have seen significant increases in new home sales,which has led to a decline in new housing inventory. Historically,an increase in new home sales and a decrease in housing inventory have been clear signs of a turnaround in past downturns.
But the fact remains that new and returning investors may still be leery of stepping back into an emerging real estate market. When asked about hesitant investors,Robert Allen said now is not a time to be sitting on the sidelines.
“The investors who see the most success are the ones who buy when everyone is selling and sell when everyone is buying. It’s a fundamental law in real estate and that’s what’s starting to happen right now. Prices are at historic lows,so bold investors are getting back in the market. We’ve even retooled our whole thinking when it comes to the strategies we teach our students. The focus is now on investing in a bottomed-out market. I can tell you,there will be a lot of healthy real estate portfolios being created in the next three years.”
There you have it…You have Robert Allen, a best selling author and nationally known real estate investment advisor calling the bottom of the real estate market….then you have me….saying maybe not. Hmm,maybe if I end up being right next time this year I’ll be a best selling author and nationally known real estate investment advisor?
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