Market Insights: THE simplest way to get a unbelievable deal
March 2, 2013
Buy and hold. Three words – that’s it.Most columnists have a set number of words they are required to provide each week. In the case of the Market Insight column, the Summit Daily News editor wants more than three words. So I made it four words. The expanded version of the article was “Buy now and hold,” however, that was rejected as too short.So here I am, dictating into my computer, trying to figure out how to make this advise longer. Maybe the editor will accept an eight-word article, “Buy now and hold for a few years.” OK, still too short, darn it. So here are three reasons to support, “Buy and hold.”
There is no need for me to provide you with the data in this regard. You have been seeing this all across the country and in the media. What I can tell you is that at a recent international real estate conference that I attended, the consensus of a panel of economists was that due to low inventory, low housing construction in recent years and pent-up buyer demand, that over the next 10 years we can expect prices to go up around 40 percent or +/-3 percent a year, which is in line with past average appreciation.
The economists mentioned above stated that nationally prices have fallen 33 percent. I don’t know about that; however, here is what I have seen in Summit County:> Minimum drop in prices 20 percent > Typical drop in prices 25 percent> Very common drop in prices 30 percent> The largest drop in prices 40 percentIn other words, everything is on sale right now. No matter what you buy, you are getting a deal. The lot shown in these photos located in the Highlands in Breckenridge is for sale right now and is a perfect example. Here is the history of the sale price:> 2000 – sold for $360,000> 2007 – sold for $495,000> 2013 – on sale for $349,000 (30 percent below the peak)See what I mean? All you need to do is buy, as examples like this are a genuine bargain.
I learned this from a mentor, Bob Girvin. Bob is a Breckenridge icon and a great Realtor at Coldwell Banker in Breckenridge. He made his first real estate sale in Summit County in 1972 and is still a very active Realtor. Bob has experienced three market slumps. The first started just after he arrived in1973 and lasted four years. The next one started in 1981 and dragged on for seven years. And, of course, the current one that started here in 2008 (two years after the rest of the nation). Here is what Bob says: “I have learned our market is like fly fishing. The overall economy is the rod and our tiny little market is the fly on the end of the line. When the rod is moving back, the fly is still way out in front of the fisherman. All of a sudden the rod snaps forward; however, at that stage the fly is still heading back. Based on my experience, our market lags the rest of the country going into and coming out of real estate slumps.” To sum it up, buy.See you next week. Love life, DanielReach Daniel Webster Johnson at (970) 393-3300 or him drop him a line at Daniel@YourMountainBroker.com. He is a very active, full-time Realtor in Breckenridge, who has earned the national Quality Service Certified Platinum award, recognition of 100 percent client satisfaction. He is one of the team at Resort Brokers Real Estate located at 100 S. Main St., Breckenridge.