Housing Market Numbers
There are a few different ways you can tell if the housing market has hit bottom. You can look at permits for new construction. You can look at housing statistics, including home values, number of homes sold and foreclosures. I believe that all the statistics above are for people looking for excuses to do or not to do something. These numbers don’t take into consideration what you can observe right in your neighborhood.
In my neighborhood in Tampa, Florida, it’s obvious that we have entered a “Seller’s Market.” Four years ago 10% of our 1,000 house subdivision was for sale. Today, it’s less than 2%, and good houses go fast. Look at the neighborhoods you buy houses in or are interested in and compare that to what you saw there one year ago or two years ago.
Did it turn into a rental neighborhood or is it primarily a homeowner neighborhood? Are there a lot of “for sale” signs or are there a lot of vacant houses? What you can actually see first hand is far better information than what some real estate guru, politician or the media is reporting. “Statistics are for losers,” said Mike Ditka, the former Chicago Bears football coach years ago. I believed him then and I believe him now.
Recently I read that Atlanta, GA home prices dropped 14.5% from April 2012 to May 2012. Honestly, I have no idea how someone perverted the figures here in Atlanta, but that sure is not what I see on a day to day basis. We have to out-hustle a zillion competitors to deliver the best houses we can to investors that appreciate our efforts. The numbers you read in the paper don’t count. What counts is what happens to you when you buy a cash flow house.
The current decrease in the number of houses on the market has increased the prices in the markets where we buy houses. This is a good thing for people that are currently holding well-located houses. If you don’t own houses, or are looking to add to your portfolio, GOYA baby! Get off your anatomy and do something about it now! One year from now you will look back and realize the best time to buy houses has passed you by. Get in now while you can take advantage of cheap interest rates, allocate cash reserves for cash flow, or use your retirement account to buy houses. Be careful of all the numbers you read about regarding any topic. People use statistics to persuade you to their way of thinking. There is no replacement for common sense.