10 Things You Will Notice After the Real Estate Market Has Bottomed

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Original content by Marc Rasmussen

Fed Bails Out Lenders


1. Lower supplies

Real estate isn't rocket science. If you have too much inventory without an increase in demand prices will fall. That has been the case the last 3 years. In order for a bottom to occur we need lower supplies. After the bottom has hit supply and demand graphs will resemble the markets prior to 2003.

2. People stop talking about real estate

Foreclosures, the housing bubble and collapse won't be the topic of so many conversations. You won't go into the gym or a restaurant and overhear real estate horror stories.

3. Real estate isn't as newsworthy

You will be able to listen to the nightly news or read a newspaper without seeing or hearing "foreclosure."

4. Optimism

You will see more people smiling because they are more optimistic about their future.

5. Investors will be looking to buy real estate again

Real estate prices will be low enough to attract long term investors back into the market. The numbers will make sense again. Rental income in relation to prices will become more attractive. In Sarasota, Florida I am getting more calls from investors. 

6. Lending guidelines will have loosened a bit

Most people need to borrow money to buy homes. If we can't borrow we can't buy. I have heard stories recently about people with 700+ credit scores and plenty of assets who are having trouble getting financing. That won't be the case forever.

7. The bulk of foreclosures have already hit the market

Foreclosures won't end. We had them before the boom and we will always have them. The problem we have now is a foreclosure snowball. It needs to stop before the bottom will set in. The market will either do it for us through lower prices or the government will get their bailout plan right and get it stopped.

8. Greed will come back

More people will have the hope and optimism that real estate prices will increase and that they can actually make money on real estate again. Greed will resurface and you will see more people taking risks. People won't forget about the real estate bust so the greed won't get out of hand.

9. Stability

You probably won't see such wild swings in the stock market. Things will be a bit more stable.

10. Wiser

Everyone will be a little bit wiser because of this real estate bust. It will be a long time before people forget (or ignore) what happened. Perhaps it will take a generation. We will all come out of this a little more cautious.

Comments (2)

Mike Grumbles
Gray Fox Realty - Franklin, TN
The Relocation Engineer in Franklin TN

DEAD ON ACCURATE as far as I am concerned.   Thankfully TN didn't have the high highs and isn't seeing the low lows.  The market is being affected more in TN because of job loss and corporate cut backs from fallout of outher industries that are due to the poor housing market in the BIG real estate markets (northeast US, California, Coastal Carolinas/Virginia, and Florida).    Their markets turned and so they lost equity in homes and investment properties and then stopped buying cars and boats and etc.  Those cars and boats and such were linked to on the ground jobs in the heartland of America.  So TN (in my opinion) was impacted by fear of loss of jobs as layoffs came anf the economy slowed.  There is not a 40% reduction in home values in TN, which is what the big markets saw and even more. 


Great post, I will listen to stop hearing real estate spoken at every gathering of people and especially on the news!



CFO Exit MidSouth


Jan 30, 2009 03:12 PM
Dona Reynolds
Berkshire Hathaway Home Services Stein Summers - Saint Joseph, MO
St. Joseph MO

Hi Gayle! 

Nice Post!  Our inventory has seemed to drop but we have had very cold winter also.  Investors are buying most of our repos also.  Our market is really not that far off,  our job sources are pretty diversified which certainly is a positive for our area.

Feb 02, 2009 02:39 PM