economic fear

“Do Not Be Fearful” – The Mantra Of A Realtor & Caribbean Sailor

At the start of any new adventure fear and uncertainly always impacts important decisions.  FEAR = False Evidence Appearing Real!  We are in the midst of a BIG real estate adventure in the East Bay - the Economy!

This phrase, “Do not be fearful,” is one that I have not only used as a Realtor, but also as a life long sailor.  It is the phrase that is used by those “staying behind” to those who are about to embark on their next adventure. My experience with this mantra is based on the fact that no one actually knows what will happen during the adventure. Those who are “staying behind” actually don’t care, even though they may be highly impacted by the events of the adventure.  Are you getting the drift of my analogy with this scene I am outlining? The one constant is that there many times the majority becomes paralyzed from participating in the next “adventure”, and there are very few who can’t wait for the next “adventure”.  I am one of those who embrace any adventure that shows up.  And…the realities of what is happening economically in our corridor is a daunting moment regarding real estate.  I am still convinced that one of the BIG issues in today’s real estate market is FEAR that is still causing Buyers to hesitate.  Wake up, interest rates are going to rise this year. How long are Buyers going to be in denial about this?

Here are some of the National realities regarding the impact of FEAR today on East Bay real estate Buyers and Sellers.  When property prices fall homeowners feel poorer, which then causes them to spend less, and sometimes save more.  GDP – gross domestic product, falls and unemployment increases.  A decline of 25% in home prices nationally, would strip out $5 trillion in household wealth.  In addition, this is a similar amount that was lost by consumers when the high-tech stocks collapsed in 2000 to 2001.  In some parts of the country there will be home prices that fall even further than where they are today! ( My personal opinion about our micro-economy is that we are in Disneyland regarding our real estate values compared to most every other market in the U.S.  Sales are up the first two months of 2008 and the inventory has shrunk by almost 20% since January 1, 2008!)

The realities are, even though the East Bay real estate markets are in much better shape than anywhere else in the country, people in the East Bay still read the Wall Street Journal and the New York Times - neither of which have any information that is relevant to the East Bay real estate markets.  FEAR is the real deal in our real estate markets. The reason why people are willing to plow through their fears and participate in their next adventures is because they have the information and experience to understand the realities of the “adventure” they are about to embark upon, and they step on board the sailboat and set sail.

Those who clearly understand the East Bay real estate markets –  factors that are impacting interest rates, plus reviewing the home sales during the last three months, will discover that this is the BEST moment to purchase real estate – whether as their next home, or as an investor.  All of the factors that are impacting gas prices, mortgage rates, the falling U.S. dollar, and many more issues, are not events to cause paralysis.  They are events to study, clearly understand, and then act – not stand on the shore wishing they could visit distant lands.  I have lived in the East Bay since 1970 and have seen many ups and downs in real estate prices and several recessions.  It is in my self-interest to make great financial decisions.  Today my advice to those who will listen is BUY!  I welcome your opinions about my thoughts of the current condition of East Bay real estate.  Again, my point is that you can never explore new shores by standing on the dock wishing you could get their – “Do not be fearful!”  Until next time…