The Law of Contrary Public Opinion

By
Mortgage and Lending with Mason-McDuffie Mortgage, Conventional Loans, Jumbo Loans, FHA, 203(k), USDA, VA, NMLS #138061 MMCD #1141

The Law of Contrary Public Opinion

 

 

"I subscribe to the law of contrary public opinion... If everyone thinks one thing, then I say, bet the other way..."

 

 

     In what I'd describe as one of history's greatest sales movies, GlenGarry GlenRoss, character Ricky Roma subscribes to the lawGlengarry GlenRoss of contrary public opinion.  His sentiment is one that echoes loudly in my life on a day to day basis.  Recently, it's a quote that's weighed heavily on my mind as our industry sees a shift.

 

 

     Consumer sentiment has been off the charts in the marketplace over the last year.  Home values have skyrocketed.  The stock market has done the same.  So what did I do?  Take on debt?  Spend?  NOPE.  When everyone else has been spending, I've been positioning.

 

 

     Will the market take a dip?  Will my income?  Will the entire industry implode leaving us all wondering what we'll do next?  While I don't think any of that will happen, it's nice to know that even if it did, I'd be fine.  I've taken the good times to position myself with next to no debt, and all the flexibility in the world.  

 

 

     Contrary public opinion can lead to some really great things, because some of the best opportunities are missed by the masses.  Think about it - when did we learn the exact moment home values hit their low point?  How about stocks?  Once the values (and prices) went back up, of course!  Who made a killing?  The folks who jumped into the fire, and succeeded in an environment of fear!  When everyone thought real estate was collapsing completely and the stock market was a fools errand, that's when they jumped in!  And they got the lowest rates, the lowest prices, and are in a tremendous position today! 

 

     I wasn't in a position to have contrary public opinion help me in 2008.  I am today.  When the world tells me to buy, that's when I'll sell.  When popular opinion is "spend", I'll save.  When Ebert tells me I can't miss a film, I'll wait for the DVD (blueray, stream, I don't know, what do people watch movies on after the theater these days?).  When the market says Bitcoin is the future, I'll pass on that.  

 

 

And do yourself a favor.  There's some coarse language, and some inappropriate stuff in the mix - but if you've never seen Glengarry GlenRoss, grab yourself a cup of coffee, pop in that DVD, and get ready to be entertained.

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Rainmaker
1,590,619
Lise Howe
Keller Williams Capital Properties - Washington, DC
Assoc. Broker and Attorney Licensed in DC, MD, VA,

Congratulations on the feature and such good advice. Thanks for a great post to read this morning.

Dec 05, 2018 04:49 AM #6
Rainmaker
1,137,117
Carol Williams
U.S.: I specialize in helping agents who have been in the business 2 years or less create a thriving business. - Wenatchee, WA
"Customized Mentoring & Marketing Services"

Hi John,
Your contrary approach has made a lot of people rich ever since the beginning of time, I think.  Being in a position to do it is another thing, isn't it? 

Dec 05, 2018 05:16 AM #7
Rainmaker
2,815,427
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of Manchester NH's Leading Agents

They say what the public does it what makes them the public. I like to hedge my listings keeping bank owned homes in my marketing. I am ready when it comes. 

Dec 05, 2018 06:33 AM #8
Rainmaker
1,262,078
Jon Kolsky
Kolsky Realty & Management - Long Beach, CA
Licensed California Real Estate Broker

John Meussner ~ I like that you are now in a position to move against the current. It's one thing to know what to do, it is another thing to be able to act... BTW: Awesome flick

Dec 05, 2018 07:46 AM #9
Rainmaker
728,608
Kevin Mackessy
Blue Olive Properties, LLC - Highlands Ranch, CO
Dedicated. Qualified. Local.

Coffee is for closers as they say.  Always good to revisit a movie you haven't seen in some time.  

Dec 05, 2018 11:06 AM #10
Rainmaker
2,351,705
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

"These are the new leads and YOU may not have them.....

Dec 05, 2018 02:16 PM #11
Rainmaker
104,203
John Henry
John Henry Masterworks Design International, Inc. - Orlando, FL
Residential Architect, Custom Home Design

I remember this movie in a hazy way but as far as the quote... I'm not sure even THAT quote holds true most of the time either -- as far as buying stocks, houses, etc.

Dec 05, 2018 02:17 PM #12
Rainer
343,872
Jana Holmstrup
Jana Holmstrup - CEO - Kings Mortgage Services, Inc. - Visalia, CA

I'm so with you on this!  How many articles read about the poor millenials are coming but they can't buy - yet they already made up over 50% of our production.  I believe too many "journalists" jump on the story of the day and its overload, not reality.  I bought stocks as soon as they opened after 9/11 and have reaped the rewards!  Get off the Bandwagon!!

Now I need to find this movie - in whatever form they offer!

 

Dec 05, 2018 06:47 PM #14
Rainer
200,598
Greg Mona
Faira - Scottsdale, AZ
Real Estate in the 21st Century!

Hi John. You've done well to be positioned to pounce when the next opportunity shows itself. One thing that immediately came to mind reading your post was the 2007-2011 time frame. In our market, that marked the 
"beginning of the end" and the lowest point in the housing market (Aug/Sept 2011). For most of us, it was survival mode. Yes, we saw these incredible deals right in front of our face; both in the housing and stock market. But guess what? Most of us didn't have any money to take advantage. When we were selling houses at 40% of their former market value (which they have since reached and surpassed in many cases) we kept saying "man, I wish WE could be the ones buying these". The same held true with stocks. The point is the old saying "the rich keep getting richer" is very true. That's not sour grapes, but just the way it is. For those positioned well financially during the last downturn, they cleaned up. But for every one of them, there were thousands of people who lost virtually everything. It will be the same next time and the time after that. It's just how it works.

Dec 06, 2018 06:22 AM #15
Rainmaker
372,085
John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL Real Estate GRI, SRES,GREEN,PSA

John, I enjoyed your post. You gave some great thoughts to ponder.

I know that when the housing market crashed, so many agents left the business.

Some out of fear, some out of money, most because they were not prepared for a shift. You are so right than those who stayed, were prepared and jumped into the fire made a lot of money.

Best wishes

Dec 06, 2018 08:04 AM #16
Rainer
95,618
Anne Corbin
Fritz Realty LLC - Spotsylvania, VA
Serving Lake Anna & Central Virginia

I like buying when prices are lowing and selling when prices are high. We've been lucky to sell our previous homes and make money vs. selling at the wrong time and taking a loss.

Dec 06, 2018 09:02 AM #17
Rainer
4,405
Dennis Erickson
Berkshire Hathaway - Bozeman, MT
I help people make good real estate decisions.

John, I appreciate your thoughts and think along the same lines.  As for watching Glengarry Glen Ross again, I don't think I will.  It's too realistic on some levels.  I've recommended the film to new agents.  I have a twisted sense of humor.

Dec 06, 2018 09:46 AM #18
Rainmaker
1,183,210
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

I think those that survived the last downturn were perhaps those that had acted "contrary" prior to it .. and throughout it, John Meussner ... especially those in lending.  

Gene

Dec 06, 2018 12:46 PM #19
Rainmaker
252,792
Elisa Uribe Realtor #01427070
Golden Gate Sotheby's International - Oakland, CA
California Homes for Sale in the East Bay

Great post John, thanks for sharing!

Dec 06, 2018 01:36 PM #20
Rainmaker
2,664,219
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I have definitely heard in economic times that when everybody else is panicked is the time to act and when everybody else feel safe is the time to be a little cautious. That’s definitely a true thing, I would say so

Dec 06, 2018 11:11 PM #21
Rainmaker
2,664,219
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

Elisa Uribe Realtor #01427070 I think we can all benefit from playing it smart with the economy and especially in our line(s) o work. All the best!

Dec 06, 2018 11:13 PM #22
Rainer
462,296
Sham Reddy
H E R Realty, Dayton, OH - Dayton, OH
CRS

That's what smart real estate investors do; They sell when everybody is buying and buy when everyone is selling!!!

Dec 07, 2018 03:44 AM #23
Rainmaker
623,521
Candice A. Donofrio
Next Wave RE Investments LLC Bullhead City AZ Commercial RE Broker - Fort Mohave, AZ
928-201-4BHC (4242) call/text

Great post and resonating directly with me . . . a Q about the guy who got featured for his SEO post . . . I had half a mind to hire him just because so many people were bashing him!
Public opinion is always subject to consideration of the source.

I consider it, it's usually wrong, I go against it.
It's ALWAYS about timing . . .

Dec 07, 2018 07:13 AM #24
Ambassador
3,775,820
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

John

Good read! Sounds like you are well positioned for whatever may lie ahead. Never saw that movie but sounds like I should

Have a great weekend!

Jeff

Dec 07, 2018 04:54 PM #25
Ambassador
3,569,181
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Hi John- it's been years since I saw the movie but you're right, it was an excellent one! (a little dark, though) I love to watch Jim Cramer on Mad Money when the market goes bonkers. When stocks drop and everyone starts selling, he views it as an opportunity to buy. 

Dec 08, 2018 12:29 PM #26
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