CNBC’s Dennis Kneale crunches the numbers in this video. I watched it a couple of times and took notes. We have to remember that real estate markets are cyclical, and Dennis Kneale suggests the current downturn is, in fact, a much needed correction from skyrocketing prices and easy lending. We are experiencing ”necessary pain for a return to rationality”. Consider there are 120 million homes in the US, 1/3 of which are owned free and clear. No need to worry about them. Of the rest, half of those were purchased before the year 2000 and are enjoying a net 34% increase in value. Is it possible that we can’t get anything done unless we call it a crisis? Home values fell a mere 1.4% in a year! And inspite of the news that foreclosures are up 65% over last year, only 2% of all homes are actually in foreclosure. Congress is planning a $300 billion bailout, but by the time this actually comes to pass, the free markets will probably have taken care of the situation.
My beloved Dad, the eternal optomist, the guy who got me started in this business, passed away peacefully from this world on July 9th. He taught me to expect markets to rise and fall and to keep a positive mental attitude no matter what the circumstances. Have we hit the bottom? Probably not. But let’s not get swept into panic, gloom, and doom. Instead, let’s keep working hard, support the economy, and expect the best!
Denise
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The old philosopher, DAD. He was always positive. He was smart, and great business man. He put 4 kids thru college in the 70’s! He is in my brother and three sisters. He is not here anymore but he is in our hearts and minds.
As my brother and I used to say, “Times will be over.” I’tl all get better. WSY