It's a New Year full of new hopes, new dreams, and new intentions. For many of us, these "resolutions" may be as modest as losing 10 lbs, committing to the gym, or joining a book club, while others in pursuit of heftier challenges, are attempting to reenter the workforce, to pen the great American novel, OR for the truly ambitious, hoping to sell their homes in what is clearly, a "softer marketplace." (Hmmm . . . Happy New Year?) Welcome to the Brave New World . . . .
It stands to follow then, that the question Realtors are most often asked (by both Buyers and Sellers) as we anticipate the Spring Market is: "If we wait until next year [to buy or sell] will the market improve?" In other words, "Is there more money to be made down the road?"
That's the $64,000 question (quite literally) to which I can only reply, "I don't know." I can't deny that you may, in fact, do better by waiting, but frankly, you could do a whole lot worse . . . (Does that clarify things?) The truth is, NO ONE knows the answer to "when will I profit most?" - including the very vocal "experts" on TV and the Internet. Although economic opinions abound by those more pedigreed than me to predict the future, the reality is that the only market anyone can accurately measure, is the market that has just passed them by, and to a lesser degree, the market in which they are currently in OR to paraphrase my Broker, John Karnay; history is revealed through a rearview mirror.
Regardless of whom you choose to believe, the future is just an educated guess. Depending on the world markets (The euro's uncertain health has huge repercussions for the dollar here in the U.S.) the outcome of the election, job growth, interest rates, and above all else, consumer confidence - the "value" of real estate OR to be more blunt, the value of your home, could move in either direction. While "recovery" is all but certain given previous patterns, WHEN it will happen, is still very much up in the air.
I know that's of little consolation to those of you who are on the fence and I apologize for the ambiguity, but absent a crystal ball, thoroughly understanding today's marketplace, as well as analyzing past performance, is the best any of us can offer. Moreover, "timing" the market to meet your desires is nearly impossible. Adjusting and adapting to the marketplace you are currently experiencing, IS.
AND here's another reassuring note that applies: markets are "relative." So if you sell in a softening marketplace, you are also buying in one. Conversely, when prices soar, they go UP across the board. Make cents?
One final thought for your consideration: perhaps it's time we reassess the concept of our homes as "investment products," and think of them instead, as "security measures;" as a welcoming place to hang one's hats, to safeguard a family, and to lay down memories. IF we return to the paradigm of yesteryear, when our folks stayed in their homes, paid down the principal, and rarely (if ever) borrowed against the equity, then with time and with favorable market conditions, perhaps our real estate will grow to become real investments once again. In the meantime, "There's no place like home." (Thank you Dorothy.)
To recap: markets can be uncertain, value is a moving target, the future is unknown, hindsight is 20/20, adapting to the current marketplace is critical, all markets are relative, and home ownership is a worthy reward. (Whew, that's a lot packed into one week!)
So with that advice firmly in hand, how can I help you (or your friends) make the best decisions in 2012 for you and your families? I'm here to provide answers, but the choice to enter the marketplace or to wait it out, remains firmly with you!
Happy New Year!
Julie Gardner, has been writing The Perspective for 18 years and has published more than 670 essays on life and real estate.