In recent weeks, several of our buyers have found a great property at a great price, then, after talking to their brother-in-law or their son who works at Best buy, they tell us "We are going to wait for prices to come down even further."
The next week, that same great home at a great price has sold. Our client insists that there will be others at even better prices.
Other, more realistic clients see that prices have come down significantly here in the Coachella Valley and realize that the Real Estate market is cyclical. They know that even if prices do come down a little more, they will eventually come back up. They are not trying to make a quick buck, they are looking for either a primary or second home that they can live in and enjoy for more than three or four years. They know that the tax advantages of owning a home for those three or four years will still be significant.
They know what we know: Whatever you buy today will be a GREAT deal in three to five years.
Those who sit on the sidelines and wait for the bottom of the market may be left just waiting.
The problem with waiting for the bottom is that we only know where the bottom was in hindsight. We never know in real-time that we have hit the bottom of the market.
Greed is what got us into this mess. Greed will keep otherwise good buyers out of the market while they wait for a chance to be greedy and "steal" a property.
The Coachella Valley is a market significantly different from others in the state and country. We have a HUGE resort property market. A greater percentage of the homes here are second homes owned by relatively high-income and financially stable owners. These are people who are in a position to wait out any downturn in the real estate market and not at any risk of foreclosure.
The appreciation in the area has been not only due to the overall housing boom seen throughout the country, but also driven greatly by the tremendous growth we see occurring here. The population in the Coachella Valley is expected to DOUBLE its 2006 number by 2012.
Buyers who can afford to pay cash now or who qualify for a conventional fixed-rate mortgage or 30 year fixed with a ten year interest only period are in a good position to buy a great home at a great price.
My advice to buyers who are sitting on the fence: "Get off the fence. You're in danger of getting a picket stuck in a very uncomfortable place."
Deasy Penner Podley - Pasadena, CA
Realtor, GRI
Hi Gary - If only the buyers could seriously listen to us... I am sure they will benefit from our advise.
Mar 13, 2008 08:44 AM
Aubrey and Associates Realty - Layton, UT
The C Team
Anonymous
The same advice that in 2005 was "buy now while you can still afford it?"
How will you feel about your advice if prices are 20% lower next year?
EVEN IF prices rebound soon, they will likely do so at a slow rate of appreciation - like around the HISTORIC 3% or so.
I'll gladly take that 3% hit in order to know that there is not another 10% decline ahead. Very cheap insurance.
Housing prices move slowly - there is far more danger on buying too early than too late right now.
I know that you really, really, really believe the advice you are giving, but consider the consequences of being wrong, as so many realtors were who never predicted this downturn.
Think of all the agents that told people to hurry and buy now in CA. Now many of those people are underwater over 100K. A tragic legacy for those agents. Don't fall into that trap.
Mar 13, 2008 06:15 PM
#4
Thomas and Drake Group, Windermere Real Estate - Desert Hot Springs, CA
Like I said "Greed is what got us into this mess. Greed will keep otherwise good buyers out of the market while they wait for a chance to be greedy and "steal" a property."
For some, owning a home means owning a HOME where they intend to live and have a life outside of what they think they are worth on paper.
If a buyers intention is to LIVE in their home for MORE than three to five years, then now is a great time to buy.
For day-traders who want to see their homes value rise up like a rocket and can't afford, weather or stomach a downturn in the market, my advise remains the same as it was three and five years ago: RENT.
Unlike some of the more unscrupulous agents who were in this business for a quick buck, my partner and I actually discouraged and talked many of our clients out of buying a more expensive home on an adjustable rate - especially our first-time buyers who have a certain paycheck each month which was not likely to change significantly before their rate would have adjusted. If we could have lived with ourselves, we would have taken the higher commission and run, but not everyone is in business or in a home to make a quick buck.
Mar 14, 2008 04:59 AM
ct - Victorville, CA
Hello Gary,
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Oct 08, 2008 03:45 AM
Compass - San Francisco, CA
Realtor - Homes for Sale in San Francisco
Hi Gary,
I've been an owner of property in Desert Hot Springs for some time now. I really have been facinated with that little town, the views, the spas, the water, the topography. I have also been very disappointed in the city's leaders, although recently I have seen some improvement such as Operation Falling Sun and improvements to the roads.
Of course prices continued to tumble. I can live with that since I bought right, but I really feel badly for the people who decided that DHS had promise only to see this recession take a serious toll on prices and as such the explosion of foreclosures.
Where do you see things going from here? Are there any developments that might be bright spots for the town and for anyone who might consider owning and living in DHS? I hope this finds you well and I look forward to any comments you might have.
Happy Holidays and best to you,
Frank Castaldini
Nov 28, 2009 12:11 AM
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker
We invite you back to ActiveRain in 2016!
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Surf some blogs, leave some comments.
Aug 30, 2016 06:02 AM
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