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Are you a Sheeple or Smarter than a Cow?

By
Mortgage and Lending with First Lending Solutions NMLS ID 1325784

What the heck is a sheeple you may ask? Its a term I ran into a couple of days ago as I was researching a project online. I don't recall seeing who coined the term, but thank you in advance.  The definition is as follows:

Sheeple are people that follow blindly and never question their leaders. Their simple motto is:

"Follow the Asshole in front of you."

What does this have to do with being smarter than a cow?

I guess as I drove home yesterday past the dairy farms (yes, they still exist, and yes I can still smell them when it gets really HOT!), my 4 year old pointed out all of the cows running in a herd.....don't know where she got the term herd, but of course I was listening to talk radio (actually wanting to scream at the ignoramus talking!) and the current state of our industry, and I thought of the herd mentality in real estate right now.

I know they will pass, not because they always do, but because this is a normal cycle. We're dealing with the stampede of a liquidity crisis, subprime meltdown, and a real estate market that for the most part is still extremely STRONG price wise, but not moving at the incredible pace we've had for the last several years. Some markets are still doing very well, and many are NOT. Foreclosures and short sales are a huge concern, but then again, they've always been around. The difference is that this time around, the solution will not be an easy one as it has always been historically. We're at the top of the mountain, and its hard to get off gracefully.

The smart thing to do when the herd is running towards you is to stick with the crowd for your own safety. No point in getting trampled......so if you're a homeowner that doesn't need to sell, simply stay put. There is no point in "testing" the market by overpricing a listing....I can tell you the outcome right now. It will NOT sell. Save yourself the grief and the time. So if you're a buyer that thinks you're going to offer a ridiculous low ball offer of 25% below the list price; well dream on. Unless the listing is overpriced by 30% to begin with, you will not own a home "on the cheap" anytime soon, at least not by this definition. I'll get back to you shortly. Are short sales the solution? Your home will continue to devalue, so just stop the bleeding now, take a $150K loss, and get taxed on the deficiency? Is that really the best answer? Maybe...maybe not. Every situation is unique. Is a bank owned property the best way to save some serious money as a starter home. Could very well be, IF you're patient AND deal with the right agent and lender. Like any other professional, not everyone is created equal. Will the auction house provide the greatest savings. Yea, 1 out of 100 times it will....the rest of the time, you will get bid up by others in the crowd. I shared this recently in an article for the San Diego Union Tribune, and lo and behold, the CEO of the auction house, disagreed with me. Oh well, boo hoo.

Now the great thing about a herd, is that if you watch a herd trample everything in its path, you will find great opportunity in what is left behind. If you've ever been through this cycle before as I have, now is that time. It seems like you will not hear that in the media for some reason. I don't believe it is malicious...I just believe that its tougher to provide consumer pieces that people will hold onto given the current climate of news, along with the loathe behavior of the few bad apples in every part of the real estate industry.  

So are you a sheeple by standing on the sidelines ready for the market to melt because everyone says the real estate market is horrible? It is not horrible, and it will not melt! I know, maybe I'll wait until prices drop further, at which time I will jump in, counter offer repeatedly, and drive up the price on that "deal" until its back up to where pricing is today.......

Or are you the cow that just likes to "mosie" along until the next real estate cycle hits, at which time, you will morph into a sheeple, and again, its too late.

My point is plain and simple. If you are renting currently, it is a great time to buy. If you are buying, we're in a buyer's market, so you will benefit from the inventory out there. If you are selling, you will not get top dollar, but who cares when you're buying, so what you don't make in profit, you will save on the purchase side. If you're a real estate professional, times are lean, but if you educate your clients, they will appreciate you for years to come for what you will help them accomplish. If your credit needs a little work, its a great time to fix it (there is plenty of inventory and you want to do it before credit scoring requirements change in 2008!).

My background is in mortgage finance, as well as Sales & Marketing. Recently, most of what I've been working on is Short Sale and Foreclosure consulting as a result of a recent book release. As well, I have been working on financial education for teenagers and young adults so the next generation can learn from our current mistakes, as well as those of our recent pasts. (oh yea, and developing that website which never seemed like being that important...what was I thinking?).

My co-author, Danielle Babb is a professor by trade, and will be teaching Finding Foreclosures as an extension course at UC Irvine, with an abridged version being prepared for realtors, lenders, and consumers. Its funny to imagine that the book itself has become a consumer guide for the countless families that need help avoiding foreclosure, but has also become a training guide for those in the real estate community, and the the consumer who is wise enough to see the opportunity of looking through the smoke and mirrors of this market, to see all of the gems that are available when the media is done scaring the hell out of everyone!

Why do I even mention all of this? Because I believe that being honest and transparent helps people understand that truth helps solve problems. If the deal makes sense today, AND you can afford it, why keep waiting? Could it be that you also want to have your cake and eat it too?

Get out there and make some smart decisions. It's what we're used to doing. Why stop now?

 

 

Show All Comments Sort:
Susan Raposa
South Dakota Real Estate Company - Rapid City, SD

Love the Sheeple term!  I'll have to remember that one.

Your explanation of the current market was dead on - good job!

Aug 19, 2007 11:37 AM
Bill Nazur
First Lending Solutions - Riverside, CA

Susan

Thanks...I loved that term.....I'm comfortable enough to look at myself in a self-deprecating manner...guess I've been a sheeple before too! LOL!.

Let's see how many people will say that I slanted one way or another,,,,,I'm so curious to see! :)

Aug 19, 2007 02:02 PM