The ‘Don’t Buy Now’ Crowd Singing Their Favorite Dirge

We’re in a tough market, at least in most regions of the country. I’m in San Diego and there has to be some solid pricing, great marketing, and pretty cool curb appeal to sell a home — and 101 other things. It’s not like falling off a log. I don’t sell houses for a living. If you need your home sold in San Diego give Kris Berg a call – she’s the best. And she won’t tell you there are no buyers out there for homes.

I deal exclusively with investment real estate. That market is lousy here too.

I started out on the house side. I remember knocking on doors back in, and the older owners advising the young whipper-snapper at their door not to buy in this market. At the time the country was in a recession. The media was mostly saying the same thing, but in somber tones. You know, like the family dog died.

I received the same sage advise in the early ’80′s, again in the early ’90′s, and of course, now. Their tune never changes, like one-act singing ponies.

The majority of folks today are not buying investment properties. They're pretty much not buying them everywhere. The media, God bless them, are reporting all the bad news about buyers staying out of the market. This tends to influence the mainstream regular-guy investor who, understandably, wants to avoid mistakes like the plague. But it makes sense to these investors not only because of what they read and hear, but also possibly due to their own experience. Or their parents' or grandparents' -- who may also be telling them to wait, don’t buy now. Did we tell you about the time…….

Let’s review the times it was ‘not adviseable’ to buy as an investor.;;; and 2006-?.

If you didn’t buy in say, 1975 in San Diego you missed out Big-Time. A single family detached home could be had back then for $22-28,000 all day long. By the spring of 1979? That same home would’ve sold for about $80,000! Maybe more.

In 1982 interest rates were way down from their previous nose-bleed highs, but still double digits. Nobody was buying. Then I noticed a couple Iranian families who had barely excaped from Iran in 1979, with only a fraction of their wealth. They bought eight homes from a builder who’d given up selling, and had rented them out. They put 20% down and paid about 11.5% interest. They paid $60,000 apiece. Those homes were worth $150,000 in the spring of 1989. They knew what they were doing.

In the beginning of the 1990′s people were really up in arms because of the S & L crisis. To make a long story short, if you bought a duplex for $130,000 in 1994 you could have sold it for in excess of $250,000 in 2001. Enough said.

And now those same experts are saying now’s the time to sit on the sidelines. They’re what we call in baseball ‘oh-fer’. They’ve been up to bat with the chance to knock it out of the park four times in the last 30 years and whiffed every time. As a matter of fact they didn’t even strikeout because they wouldn’t walk up to the plate with a bat. They’re positive this time — just like the last four times.

I’m saying, without reservation – buy now. I believe so strongly in one particular region I’m spending six figures just to put an office there and establish a presence. That’s commitment. That’s putting my money where my mouth is.

This isn’t just BawldGuy Talking — This is Bawldguy walking his talk.

They are a broken record and have been saying the same thing since way back when I still had hair. The next time they’re right will be the first time.

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