Guard Your Mind II

Real Estate Bust?

Recent economic numbers after a robust July in the real estate market prompted commentary by David Lereah, NAR’s chief economist. I found the following from a recent NAR reference on a CAR newsletter.(Sorry for all the AR's)

“In looking at year-to-year comparisons, the pending home sales index has been very close in predicting the actual pace of home sales,” he said. “Based on recent changes from a year ago, the index shows existing-home sales should continue to ease after a stronger-than-expected decline in July, but are likely to flatten in the months ahead.”

Lereah said psychological factors account for much of the decline in home sales.

“We’ve never seen a general decline in the housing market against a healthy economic backdrop where jobs are being created, the economy in growing and interest rates are favorable,” he said. “Psychological factors are causing some buyers to remain on the sidelines, waiting for prices to stabilize or for more favorable news about the market and the economy. Contributing to this hesitancy is a lot of negative news stories, but in the end we believe that underlying market fundamentals will prevail.”

The market will react to the news. And the news today wants to find all the negativities in this market. If you have read anything that I have mentioned about the "Bubble" you have already heard what Lereah said in the above quote.

Fundamentals Will Prevail

Interest Rates and Economic factors have never been better. However, tell that to the buyers right? RIGHT! The journalists aren't going to. NAR sure as hell won't. It is your job. Like I said in the First post to this topic. When is the best time to buy? Right Now!

My marketing friend, you are a saleman, you are a marketer.Do what Sales People do. Sell.

Sell your industry, sell your market conditions. Sell emotionally, back that up with logical irrefutable facts. "Mr/Mrs Buyer if you wait, you could be priced out. If not you , then who will. Who will sway public opinion?"

After all if you truely believe. Then you should have no problem in convincing your prospects.What is your alternative?

Real Estate Bubble Behavior?

The same CAR newsletter mentioned the following:

REAL ESTATE CONSTRUCTION SPENDING CONTINUES TO RISE

The annual pace of construction spending remained above $1 trillion for the 24th consecutive month in July 2006, rising 5.1 percent to a seasonally adjusted annual rate of $1.2 trillion, according to a recent report by the U.S. Census Bureau. Construction spending totaled $680 billion during the first seven months of 2006, up 8 percent over construction spending during the same period in 2005. The annual pace of total construction spending has remained above $1 trillion since July 2004.

During July 2006, residential construction spending declined 2.8 percent compared with one year earlier, standing at a rate of $637 billion, while the value of nonresidential construction activity rose 15.8 percent to a rate of $563 billion, according to the report.

I guess they plan on making money in this so called bubble real estate market.