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Logic

Buy Low, Sell High

This past week, I gave a home buyers seminar in one of our largest offices in the Washington DC metro area. The room was full with both Real Estate Agents and prospective home buyers looking for someone to help them feel a level of confidence about the market. The result was two couples writing contracts right after the event. Small, grass-roots, but it worked. I left the session wondering to myself, "what if everyone of our 16,000 agents tried the same thing"?

Last week, (on January 23, 2008) when the market swung over 500 points from the low to high, the media "experts" said that the market was being dominated by emotion over logic. To a large degree, that is precisely what is happening in the housing market. Logic makes a great case for buying now, while emotion and an overwhelming media onslaught have made it extremely difficult for prospective buyers to take action. So....people sit on the sidelines in the peak of this buyers market.

Question: When was the worst time to buy a home in the last decade?

Answer: In 2005 at the peak of the Sellers market.

Question: What is the media telling everyone to do now in this Buyers market?

Answer: They are saying it's a bad time to buy.

Question: Well, this is confusing. If I wasn't supposed to buy in the sellers market, and I am now not supposed to buy in this buyers market, then when are we supposed to buy a home??

Answer: When the media tells us to!

Simple truth: Buy LOW, Sell High!

I am so very concerned that people who fail to act, if they are wanting to buy a home, will miss out on the best interest rates in years, the best inventory in years, and the chance to actually select the home of their dreams and get a good value on it. This is what buyers markets are for!

Emotion vs logic. Logic is that waiting will be far more costly if you are in the market.

One last point

Simple Truths: Logic wins.

Posted by David H. Stevens on 01/27/2008 12:17 PM

Comments (10)

Post is included in group: Long & Foster Northern Virginia

10 Comments on Logic

Nicely put!

01/27/2008 12:19 PM

by Ray Wilburn, MBA (Keller Williams Realty)

Ray, If we did what the media wanted us to do maybe we would all bury our head in the sand and wait fir the second coming..

01/27/2008 12:29 PM

by Wilmington NC Real Estate Ginger & Roger Sala Keller Williams (Keller Williams Wilmington North Carolina)

Exactly....

01/27/2008 12:31 PM

by Long & Foster Companies

I agree with Ginger and Roger!

01/27/2008 12:48 PM

by Renee Parker, Lansing Realtor (Coldwell Banker Hubbell BriarWood)

Dave,

It is very frustrating to talk to people who think they should wait. Especially 1st time homebuyers. Waiting will cost more and they'll potentially be giving up some options that they currently can exercise like appraisal and home inspection contingency.

01/27/2008 06:22 PM

by Nancy Pav (Long & Foster)

I agree Nancy......we're kicking off a big campaign this week. I ahve all/most of the managers for the kick off call tomorrow. Let me know if you hear about it....

01/27/2008 06:58 PM

by Long & Foster Companies

Thanks for the post. I will push it out in the PA area

01/28/2008 11:26 AM

by Linda Tremblay, Bucks County Real Estate (Long & Foster Real Estate, Inc, PA License #AB065488)

David - we did the same thing at Weichert; had about 25 folks at the seminar - 13 were buyers/sellers - 1 wrote a contract that afternoon (after seeing our presentation that the market is really transitioning upward in Fairfax County) - a seller improved his price - and another seller listed with us that day.

REALTORS -- QUIT WAITING FOR THE MEDIA AND THE MARKET TO GET BETTER. It's ups to us.

02/24/2008 06:35 PM

by Anthony Carr (Weichert Realtors)

Not buying now really will cost people a lot of money. We will only know when we've hit bottom when prices start climbing back up...by then it's too late. And as for interest rates, God forbid they tick up. Isn't the Fed supposed to hold them down forever until all these buyers can make up their minds? (for those that don't know me..that's sarcasm).

I don't understand how the Fed can keep rates so low, when housing prices are so low. What happens when they both go up? People won't like what they are qualified to buy.... so housing prices will fall again. My gut tells me interest rates won't be so low for much longer. Something is going to go up soon.

02/24/2008 06:48 PM

by Chris Ann Cleland, GRI (Long & Foster)

Great comment! It is interesting that we have seen booming real estate years even when rates were 9% and higher...but the ongoing sideline sitting of renters will only build up demand. It will be interesting to see.

02/24/2008 07:53 PM

by Long & Foster Companies

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