| Souther California Real Estate Market is cooling? No Surprise to me !!!Posted Oct-14-06 08:13:52 PDT I am reading an article this
morning that says that the southern California market it cooling off to
its slowest sale rate in 9 years. This is really no surprise to me. The biggest reason seems to be common sense, I mean how long can a house appreciate in value by 30% a year? Sure it does years one, and maybe year two, but the further it keeps going in that direction a wise investor should know that it won't last. A prime example is the California market. When a 3 bedroom 1 bath house around 1100 square feet sells for around 1 million dollars you have to know that soon the market is going to turn. I have seen speculators in real estate going broke surfing the housing boom wave then the wave finally comes crashing against the shoreline leaving them bankrupt and jaded on investing in Real Estate Altogether. As investors we need to keep ourselves concious of this and not get caught up in the hype of a rapidly inflating market. Of course in a market like that playing your cards right can easily generate big profits it can also generate a huge loss if you get caught up in it. A few more years from now we are going ot hear about foreclosure rates and depreciating markets just like we did a few years ago and everyone will have fingers to point at who is to blame. No one is really to blame except greed and lack of discipline. The only way to truly protect yourself from these types of market correction is buying property with a plan to buy and hold for a long term. Buying and holding a property is the only tru proven long term investment plan, and over time has been a better investment that stock, bonds, or any other investment. There really is a reason why the richest people in the world invest their money in real estate. |
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