East Bay Blog

How many people saw a buying opportunity in the stock market on October 20, 1987? The day before, on Oct. 19^th the Dow Jones fell 22.6%, it was considered one of the worst stock market crashes in history. The drop in the Dow during that crash was 508 points, and the Dow was at a little over 2,000 points back then. Now we are at almost 13,000 on the Dow, and I can guarantee that it was a huge buying opportunity. Yet people stayed out of the market during that time due to FEAR and PANIC, and I’m starting to see those same emotions enter the housing market.

Everyday the news is filled with horrible housing news, and the psychology is spreading. You hear about lenders going bankrupt, and then how foreclosure are up, and today how even the largest mortgage lender, Countrywide Financial is starting to have credit problems, and on, and on…. It’s funny but the pendulum has completely swung the other way in regards to housing. A couple of years ago, it was ridiculous how hot real estate was, multiple offers everywhere, houses going up 10% per month, etc… We are now at the opposite of that, and just like all of those investors who wished they had sold at the top, we are entering a time when people will look back and wish they’d bought at the bottom. I am now seeing even well qualified borrowers with good credit and sizable down payments having difficulty securing a loan. Loans are still there, you just have to work a little harder to get them. The lenders are scared and when emotions enter business decisions, it spells opportunity.

So how does this affect you, the East Bay Real Estate Blog reader? Well for one, buyers, start looking for those deals. If you are planning on buying Real Estate in the near future, now is the time to start looking for the opportunities. In certain areas I am starting to see a glut of bank owned properties and short sales. These are areas where aggressive negotiating can land you some cheap real estate. Every situation is a little bit different, depending on what you plan to do with the property, there are different tactics to how you put deals together. Work with someone with knowledge and experience to help you find those deals now, while we are near or at the bottom.  Sellers, don't panic be patient and smart about your property.  Use a good REALTOR to help you sell your home.  There are buyers out there, you need to market your home extensivley, make sure you highlight what sets your home apart, and price your home right the first time.  Read my previous blog about doing it right the first time, this is important.  Don't hesitate to give us a call if you need help.  As usual your comments are always welcome, until next time…