Real Estate will continue to decline in price for at least five to ten years, but I think there will be some give, and take, with inflation. The Fed has been dumping money into the economy to keep deflation at bay, and to prop up Real Estate prices. We have to watch out that if the price of Real Estate tanks, goes down rapidly, all of the Mortgage Backed Securities will become worthless.
Now for the good news, the weakest real Estate markets have already lost up to 80% in pricing. That has brought them into a value range that many consider a bargain. Better still many of those properties carried toxic mortgages that no one wanted, so the Fed bought, and took a loss on. Even better is the vast number of people who refinanced into lower interest, and lower payments.
Some, a very few, are calling this lull the bottom of the Real Estate market. Slight decreases in pricing look like stability, which it is. We have a stability by having declining Real Estate prices.
What most people forget is that this is normal. Real Estate only tracks inflation. We only have to see what inflation has done, and what it will do to be able to track the value, core value, or Real Property. We could say Real Estate is local, but that only applies to the base. The base in Seattle Washington has always been pretty low. We then over built, and opened more doors to future development. We do have a lot of empty dirt in our urban core.
The most important thing to remember, after paying 10% to 20% below market for the property, is that you will need to pay it off.
About David Losh
In 1984 I got my Real Estate license and worked in a small company called Advance Properties. The owner was extremely interested in Real Estate, building, and land development. Most of his work was concentrated North of Seattle. Since the 1970s I had worked for Real Estate agents in Seattle as a contractor, mostly preparing properties for rent, and sale.
After a few years my skill level increased considerably concerning land use, building code, and development practices. Escrow, and lending offices were housed at the Advance Properties building so it was easy to get involved in all aspects of Real Estate. It was very much a family owned, and operated business.
Over the years my Real Estate license has been at a variety of Real Estate companies, and offices. Nothing compares to those early years, or that sense of family. Real Estate has gotten to be corporate owned.
My hope with this blog is to share with you some of the things I've learned. If you have Real Estate needs, or want contractor help, I refer freely to what best suits you. If you should choose to work with me you'll find a great resource.
My Real Estate license is at Skyline Properties in Northgate. Skyline is a locally owned company that is a desk fee office. There is a wide variety of diverse agents. It helps me with some of the other projects that I have, and mentoring that I do, to be able to work with people from other cultures.
Here in Seattle we are close to Vancouver BC and are the gateway to China. Boeing has a great trade relationship with China, as does Microsoft have with all of Asia. We are a culturally diverse community, and it helps me to be invlolved.
