Many people feel that having bought a house around the time of the "bubble" ensures that they made a huge lifelong financial mistake. Clients have lamented that they will "never be able to get out what they put in."
It's true that if you were a renter or first time buyer who purchased a home during the peak, then it would be fair 
to say that you've lost "real" money in your home. But for everybody else who sold something to buy something else, then I would argue that there is parity.
I purchased my home in Winnetka in 2004 and then decided to make it even better. Lots of people put money in their homes, right?, because it was a known fact that you would get it all back. In fact, lots of people borrowed money against those same homes because there was just so much candy coming out of that house pinata.
But today, I could not get what I paid for it, let alone the improvements. But there is another side to the story: I sold my old house at the same time and made a handy sum. I like to think that my house monies equalized each other out. Not exactly, of course, since I downsized, and other people may have upsized, but the point is that there was some parity. Not everything was lost - I bought and sold a house with a few months of eachother.
The reverse holds true today: for sellers fretting over tumbling prices, a good deal awaits them at the other end (assuming they are buying another property.) Again, it's a different story if you are a retiree who bought a retirement home years ago and have been "banking" on your current home's equity to help you through your golden years. If I wanted to sell my Winnetka home and move to, say, Wilmette, then I know that my sell/purchase ratio would be similar to what it might have been 5 years ago.
In fact, this urge is so strong that I recently saw a potential sale go bye-bye because the buyers felt the sellers did not come down as much (as a percentage) as they had to when they sold their house. They walked away before they would buy a home they loved because they were, in essence, looking for parity.
If you or anybody you know is looking to buy or sell a house in Winnetka, Wilmette, Glencoe, Kenilworth or Northfield, please give me a call!
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