Mid April 2009, will this be the date remembered for when the housing market clearly established a bottom in reduction of pricing, demand and value?
To clear up a few inaccurate ideas the media has imbedded in everyone’s minds. To start with most of PA has not been hurt real badly by the housing bubble. We never saw appreciation rates of 15-20% year over year that most of us watched and thought, “how can the market continue to rise like that.” Guess what, it couldn’t and when it crashed it took everything in site with it. Confidence, jobs, finances, building materials and even some things that were not included with the crazy pricing increases, like land.
We have watched as housing prices dropped around the country and have been relatively happy with the fact that most of rural PA did not see such a drastic drop. We have watched land values run flat for the last 2 years. We have watched interest rates drop to historically low numbers. We have watched as timber value has dropped to historically low numbers. We have watched as buyers sit at their computer and search http://www.paoutdoorproperties.com or http://www.cabelastrophyproperties.com for that piece of paradise to call their own and think, “if I would have bought that property last year I would still be able to recognize my life savings as something more that a down payment on a car. That’s were I say take that money that has cause some of the worst heartburn you have ever had and make the move to purchase your own property. When you pull on to your own ground Friday night, you will stop at the entrance road and think, “why didn’t I do this last year, last decade, when I first started thinking about have something of my own.” I ask, what’s the difference between $500,000 in your 401K and that $1,000,000 property you bought 3 years ago? The answer is simple; the property is still valued at $1,000,000 today. The market collapse was in housing prices, not land value.
Here is a couple of things to think about; you can find a lot of properties in today’s market, you can get loans in the 5% range, you can invest or hedge timber prices, you can find that place that is the answer for solving the heart burn I talked about above, you can find your dream place and we can help you do.
So if I’m correct, the bottom in housing has been established, banks will loosen up there requirements, buyers that are responsible for themselves and have good credit are on the verge of making one of the best investments they have ever made. Purchasing that piece of property with timber on it. I truly believe we are within 2 years of seeing the timber market go through the roof and why you ask? Because timber values have dropped to all time lows, most sawmill’s have minimized production if not mothballed there operations completely, no one could get a loans for large land, there was no demand for lumber, even at low production rates. Fuel prices are attractive again, financing is very attractive, people that have lost jobs are starting to find opportunities, the stock market has flirted with positive gains for a few months and above all spring is here and the sun is shining.
If you’re considering real estate as an investment or as a place to get away from it all consider this; inflation is coming and coming fast when it starts, real estate is one of the best ways to hedge inflation. If you learned one thing over the last 2 years, make sure it’s that having confidence in real estate (not housing) is something to make you sleep like a baby at night.
Now is the time to make the move. I think we will see some movement up in land values based on my reasons above. I know a lot of people keep thinking, “I can’t recognize the loss now, I need to wait for the market to come back and at least get me back to where I was before the crash.” Well, weight is what broke the camel’s back and it could be what broke your bank account.
This is a great time to be in the market for real estate, make sure you get out and look at some of our listings, we have something for ever buyer and continue to add properties of value every couple of weeks. We have a couple of auctions coming and have several more in the works. There are truly brighter days ahead and we want to be a partner with you for helping you find that dream.
Enjoy those beautiful spring days, get the garden ready, and get outdoors, you’ll love every minute.