Meyer Rothschild, 1744-1812, the founder of the Rothschild banking dynasty, was famously quoted for saying, "Buy when there is blood flowing in the streets!" He meant, buy when no one thinks there will ever be a market for real estate again.
Many buyers is today's soft housing market seem to have bought into this frame of mind. I keep hearing from buyers, "I'm looking for a real estate investment, but only if I can STEAL it!"
Not all or even most sellers are desperate to sell at this moment. Even if they were, they have high mortgages to cover in many cases. There are more listings on the market than normal, but there is no glut on the market in most locations. For these reasons, most real estate prices have been softening, but by no means collapsing.
Greedy low ball buyers risk never finding a deal that they can recognize as a good value. They can waste many hours of their real estate agents' time. They can offend sellers to the point that no one wants to deal with them. But they're unlikely to end up owning a good investment unless they become more realistic.
Right now is a great time for buyers to find great deals in real estate. Unusually good values are available. But (thank goodness) there is no blood in the streets!
Copyright2007BrianSchulman©
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Brian Schulman offers expert real estate consultation and services in Lancaster County, PA. To contact him, visit http://www.FindLancasterHomes.com/ |
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Brian Schulman offers expert real estate representation for buyers and sellers of homes in Lancaster County, PA. To learn more, visit http://www.FindLancasterHomes.com/ |
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Brian,
I don't think there's going to be blood in the streets either, at least not for our markets in PA. It's amazing sometimes how people in our market buy into the national media hype about how bad the market is and then try to relate it to ours. It does make for some interesting conversations though. Still, it's a great time to buy so I'm not complaining.
Great post Brian,
Love the graphic and the history quote. We can and should all learn from what has happen
ed in history.
While no one can accurately predict the future, we can all look back in history to try to better understand what lies ahead. The economic indicators do not fare well for our country and especially our industry. It's not a matter of if we go into a recession, it's a matter of when.
When it happens, and I personally think we are about 6-8 months into our next one, the blood will start to flow. Jobs will be lost, homes will be listed, inventories will rise, the buyer pool will shrink, money will dry up (more than it has already) and we will all be astonished by how bad it really can get.
Andrew, I agree that our markets are not as bad as some areas of the country. Sellers are not about to give up their properties for pennies on the dollar. Still, there are great values out there!
Missy, you're certainly right, it's a great time to buy. Even though there is a lot of pain in some areas of the country (including yours, I imagine), Rothschild was speaking literally of blood in the streets. So far we have had at least a somewhat orderly housing market.
Brian - I never heard that quote from Meyer Rothschild, but I really like it and how you tied it into our current market. I do believe you have one heck of a point that shouldn't be ignored by consumers or us professionals.