Having worked in 2 very different Real Esate Markets, Austin, Texas in the mid '80's, Racine, Wi from 1988-present, I have seen a few cycles of Real Estate.
I first entered the Real Estate Market as a Buyer in the '70's, people were lined up to buy properties. Then the early 80's came along, 18% mortgage rates lead to some creative financing. We adjusted, and things got better.
The Oil Crisis in the second half of the '80's and loose lending practices ( do you remember FHA Non-Qualifying Assumptions?, in a declining market that lead to a nightmare for lenders and the government. Sound Familiar?) and the Savings and Loan Crisis contributed to a very challenged Real Estate Market, in most areas in the mid to late '80's.
Most areas of the country had relatively good growth in Real Estate from 1991-2001. 9/11/2001 caused all of us to re-evaluated our priorities and reflect on what the United States was all about. As a response to the events of 9/11/2001, Americans seemed to develop a resolve that we would not let our 9/11 heroes down and moved forward in a way that, looking back, was unprecedented in growth and determination to make the United States stronger than ever.
Huge economic expansion took place. The housing market grew at unprecedented rates of appreciation. Nearly 300% appreciation in some areas of Florida, Arizona, California, and several areas in the Northeast. Many opportunists' jumped on the bandwagon. The wagon can only accommodate so much. The wheels gave in. The opportunists', the misdirection of investors buying mortgage backed securities, lenders that lost sight of good lending practices, and real estate practitioners looking only for the dollar, and many other players in the market that are/were unconcerned with the market have contributed to our current state.
There a many true professionals in the Real Estate industry that will contribute to the correction of this misguided direction. The correction will be painful for many, timeframes for correction will vary by region.
The good news is this is cyclical, good times are ahead for Buyers, Sellers, and those that truly contribute as concerned practitioners.
I am proud to be able to share my thoughts with other AR members that are obviously concerned.
This is just my opinion and I understand and appreciate your thoughts, corrections, and criticisms.
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