PUTTING THE MARKET IN PERSPECTIVE

Real estate technology company Zillow released a market report this month revealing that 29.1 percent of homeowners who purchased in the past five years owe more on their mortgage than their homes are worth. The company also reported that about 45 percent of those who bought at the national market peak in 2006 now have negative equity, and about 60 percent of homeowners in the Western region of the country who purchased in 2006 are now underwater.

With news like this it’s no wonder that consumer confidence is low and buyers are skittish. Human nature is interesting. For some reason, we tend to hang on to the negative past and ignore the possibilities of the future.

This is even more interesting when one realizes that there is nothing that can be done to change the past. We only have control over the future and how we deal with the problems of today which were created by the past.

Those that can objectively look at the market today will realize that now is the best time to buy. Inventories have stabilized and interest rates are still at historically lows levels. While prices will remain soft for a time, choices for buyers will gradually become fewer and interest rates will most likely rise.
As I have stated in the past, most financially successful people I know are contrarians. They do not let themselves bask in the past like others, but take advantage of the opportunities that most others won’t allow themselves to see. Many of your clients may need this trusted advice now more than ever. They will thank you later.