These days all we hear about how our economy is melting down. That real estate has brought our economy down, not to mention the world economy is at a standstill and has lost trillions of dollars. Many are calling it the worst recession since the great depression. Unemployment has hit 10% in some parts of the country. People are hiding their cash. Even the financial lenders are hording the money and saving it for a rainier day. Now all this is very depressing and leaves us all with many questions, but no answers. Is there any bright side to this ugly mess? I would challenge you that it might be a better market then you think and its right under your nose in one of the best places to live – here in the Vail Valley!
Let me start by saying that our economy is as bad as it was in the 70′s, 80′s, and 90′s. The difference is that it is a global melt down and a well publicized one. So here’s 7 reasons why I would argue that it’s a good market to buy real estate.
1) Interest rates are at an all-time low. The average last week was 5.07% for a 30 year fixed. So money is cheap to borrow at the moment. Do you know that a 1% interest rate increase equals a payment greater than a 10% home price reduction?
2) Home’s are pennies on the dollar. In the Vail Valley we’ve seen 10 – 40% price cuts. History has taught us that real estate is a cycle that goes up and down. And you know that it’s going to go up at some point.
3) The IRS is giving you an $8,000 tax credit to buy a home for those qualified (check with your tax advisor). So Uncle Sam is paying you to buy a home. There are also many Eagle County assistance programs available.
4) Take a step back and look at the big picture. Remember that real estate is a cycle that happens about every 8-10 years. This last cycle had the steepest and lowest points in the last few decades. SO the increase in money made and lost has been sped up. So how have the people dealt with these situations before? Well guess what the wealthy did in every down cycle we had in the last 30 years? They bought real estate when everybody was running from it. Millionaires became billionaires! What did the average American do – they stop spending and saved their money.
5) People are drowning in information and starving for knowledge. There is a HUGE need for people to teach other people how to make money in today’s market. People still have money but are not sure what to do with it. That means that you can make more money in this market then in a hot market. The reason is that there is less competition in this slow market compared to the hot market we had just a few years ago. Knowledge is powerful!! Fear is lost opportunities.
6) Can you say appreciation and cash flow? Now for the last few years’ appreciation was the in thing and cash flow was non-existent especially in the Vail Valley. Now Cash flow is king and there is no appreciation at the moment. In order for real estate to maximize its potential you need both appreciation and cash flow. In the last real estate cycle you were only going to make money by hoping for appreciation, but you had no chance of making cash flow because the prices were too high. Now you can at least break even (if you want to rent it out) and you know equity will follow in a few years. So you can now maximize your real estate investment, something you couldn’t do this last cycle.
7) Now the last thing I want to point out is that FEAR is running our economy right now. The stock market is not the place to invest; real estate is where you should be investing – a fixed asset. The way I look at it you can be part of the recession (depression) or you can be part of a solution and cash in. You choose!! I hope you’ll be a “Vail Valley Opportunist”!
Now after giving you these 7 reasons why I like today’s market, you might be telling yourself that it all sounds backwards and wrong. You might be telling yourself that you don’t want to make a move until the “market turns around”. But remember this, when the market turns around it’s because people are buying real estate again. That means that home prices are going up and so are interest rates. By that time you have already missed the boat. One last thought, you make your money when you buy your home not when you sell it and with so many great buy opportunities you’ll be sure to not only make money when you buy and later when you sell. Ponder That.
Real Estate – one the greatest investment business opportunities of a life time that you control. Call on local experience.
View ALL Eagle County Homes for Sale by Map: CLICK HERE
For more good news call the experts at VAIL MOUNTAIN REALTY
EAGLE (970) 337-SAVE (7283) EDWARDS (970) 926-7283
Visit Our Website: CLICK HERE
It’s that time of year again…Vail Snow Daze is officially here. There are great concerts over the weekend including Leftover Salmon on Friday & The Frey on Saturday. Although they are both outdoor concerts & it should be snowing, don’t be too afraid. I have been to numerous Snow Daze concerts & believe me when it’s snowing it’s always warmer. It’s the clear nights that I dread. Just remember to bundle up. There will be plenty of food & drinks available to keep you warm!
