On the 40th Anniversary of the first moon landing Nick Churton in Chase International’s London marketing office reflects that the UK and US real estate markets are now remarkably similar and thinks that taking a "giant leap" in today’s market may be a very good step indeed.
Forty years ago three brave men risked their lives to make a giant leap for mankind. The Apollo X1 mission to put a man on the moon, and go where no man had gone before, held the planet in thrall. It was the end of the ‘60s and Britain had swung for almost a decade. But, as a counterpoint to the successful moon landing, back on earth the wheels were coming off. The decade-long free spending party had come to an end.
So, no change there then – particularly as none of us really knows now what is going to happen next, any more than we did in the early ‘70s. But life and economics appear to have come full circle.
The real estate market is certainly going where it has never gone before. We are in un-chartered territory with the market very finely balanced indeed. On one hand it could remain on its present – albeit shallow – upward trajectory. On the other we could experience the double bounce or ‘W’ shaped recession, about which some economists and media commentators seem keen to remind us.
From a real estate point of view there seems little doubt that, although there is a large question mark hanging over where the market may go next, now does seem a pivotal time for home movers. If the recovery continues, the rate of increase in real estate values should ultimately rise. So now would be a very good time to buy. Were the market to slip back and values slide then it would be a smart move to sell. Moving home always features profit and loss – the financial advantage of selling almost always cancels out the disadvantage of buying, or vice versa depending on the market.
The first six months of this year have defied most market predictions. Activity has been high, and in some places demand has even exceeded supply. That was not in the script, but is a welcome sign of tentative market recovery. So too is the news from the house builders that they are seeing their best sales results in three years.
Buying real estate in this market may seem to some like a giant leap into the unknown: not quite like risking one’s life and flying to the moon for the first time, but a bold step nevertheless. However, when weighed against some of the good signs of recovery then the bold move now may very well prove to be the shrewd one.
reno newbie
So now would be a very good time to buy.
Coyote
Is this not the same old realtor spew? Grandpa said that “if if’s and but’s were cookies and nuts, every day would be xmas”. There is a lot of hedging and double talking gobbledygook in the above.
Wanker Nick is trying to sell us a house by associating it with a proud accomplishment for our entire world (the manned moon landing) is frankly deeply insulting.
No wonder realtors in general are frequently held in such contempt? (Guy and Mike excepted!!!)
Nicky boy, if you think it is such a smart idea, then offer to guarantee the future value of any home your organization sells? Put your money where your mouth is, yes?
For you to do this would be a “bold step and a “giant leap”…
Nick must think we are some kind of dumb asses to swallow his BS. That is really some offensive stuff. Hope he reads the comments!
Nothing was learned the past two years was it?
Josh
I am surprised to see this sort of hyperbole here.
FutureRenoHomebuyer
Geeze Guy,
If you are going to include guest commentators (instead of just letting them blog themselves), at least make it relevant and insightful.
“If the recovery continues, the rate of increase in real estate values should ultimately rise. So now would be a very good time to buy. Were the market to slip back and values slide then it would be a smart move to sell. Moving home always features profit and loss – the financial advantage of selling almost always cancels out the disadvantage of buying, or vice versa depending on the market.”
Whatever. Master of the obvious concluded with confusing babble. What’s the financial advantage of selling in a down market? Especially when you are upside down? Or vice versa?
I thought this was the Reno Realty Blog, not the confusing dude from London oxymoronically pontificating about the lunar landing and its relation to worldwide real estate blog. FWIW.
Guy Johnson
Sorry All,
I didn’t have a post for today. This came across my desk along with the invitation to post on the blog. I thought I’d throw it out there for commentary.
Comments noted. Should I delete the post now?
– Guy
CommercialLender
Almost 46 years ago, JFK was assassinated in a convertible limo, a day most of us will never forget. So, now is a very good time to buy a helmet or coupe limo. Helmets and coupe limos always go up in value and its always both a great time to sell them or to buy them. In some markets, the demand for helmets and coupe limos far outpace supply. Call your local HelmeTor ™ or LimoTor ™ now!
🙂
(Sorry, Guy, for poking fun, but your post truly seemed misplaced on the blog, and frankly poorly written with confusing conclusions reliant upon insufficiently laid logical arguments. I just had to attempt some humor in response!)
Guy Johnson
no worries.
Coyote
No need to delete Guy. Just be sure the ole boy reads the comments here! His hype was a good reminder of all that was so very wrong in the days of the bubble-build up.
FRH and CL: Very funny and spot-on! 🙂
Cheers blokes!
Mike McGonagle
coyote, I am deeply offended that you think I’m a Realtor! (but appreciate the waiver, in any case) Just kidding, real estate is a fine and noble calling.
(wanker) Nick has some pretty good posts over at ChaseNation about the real estate situation back in jolly old England. This one was a bit in the trees. But I, too, remember sitting up all night watching the moon landing and watching my world change. It was pretty cool.
Coyote
Mike- Very much enjoy all your posts! (Guy’s as well!).
Sorry, that guy just really got my goat. Peoples lives have been devastated and us American taxpayers are in for a very rude surprise come 2010 when the deficit goes parabolic.
Nick seems to think, “take a flyer!” “shrewed and bold move!” “see the three headed baby!”.
And his twisting and skewing of facts to suit his personal/business agenda, financial responsibility be damned, just caught me very wrong.
Because of attitudes like his, the US, UK and indeed the world will be in financial disarray for a very long time.
Out of towner
Just got the word from a friend at the FDIC. Corus Bank failed and currently under fdic control as of 8/9.
CommercialLender
Out,
Please substantiate with a link or more detail. As of tonight 8/12 there are no stories I can find anywhere to validate, though the rumors have been flying for months. I’ve been surprised for going on a year that they are still afloat, but I can find nothing to substantiate your claim (yet).
billddrummer
To CL and Out,
I don’t have that info either, and I like to think I keep up on this stuff as well.
Normally banks are closed on Fridays and opened the following Monday under a new name. 8/9/09 was Sunday, so unless the bank was seized on Friday, the story seems unlikely.
Now, this week could prove another story altogether….
naysayernot
More bad news for Somersett in today’s legal notices
RRB Fan
naysayernot … could you please summarize the news or provide a link. thx.
GratefulD_420
Actually… I think Guy’s post is very relevant to what is happening in the market today. The kool-aid is being spiked and nostalgia is starting to run high.
The bear has left…. and the bantering hsa been left up to the bulls.
I for one have been wanting to buy for a very long time…. but it is the market which has not allowed me to make a purchase (sorry but guranteeing to be upside down for many years to come is just not a wise decision for my family).
I am certain that this market will continue to depreciate [foreclosures & joblessness tell me so]…. however with the bulls running the show and the stimulus now on the table…. they may be able to push this through for many more years as true inflation comes to fruition. High interest rates and higher pay would be coming… making that $500k home @ 5.5% a deal of a century.
I think this fall to early winter will truly tell the story. If they can push through… then they will make it all the way to inflation… if they cannot.. more banks fail.. stock market falls… then we can look for deflation, falling home values and low interest rates.
so in summary..like landing on the moon… it really is an amazing time…we are at the precipice.
FutureRenoHomebuyer
Regarding Corus — found the following on the Daily Kos website:
http://www.dailykos.com/storyonly/2009/8/18/768919/-The-FDIC-is-Broke
“…The same thing can be said for Corus Bank, where 2/3rd of its loans are non-performing.
[T]he Bank reported negative equity capital as of June 30, 2009. As such, the Bank expects to be notified by the OCC that it is “critically undercapitalized” within the meaning of PCA capital requirements.
Under the FDI Act, depository institutions that are “critically undercapitalized” must be placed into conservatorship or receivership within 90 days of becoming critically undercapitalized…
Fortunately 90 days from the filing brings us to September 30.”
Perhaps not much that what we already knew, but it does appear time is running out for Corus. Perhaps when it gets taken over by the FDIC, all its “shadow-shadow” foreclosures will hit the market as well. FWIW…
Out of towner
About Corus bank:
http://online.wsj.com/article/SB125063503134941431.html?mod=residential_real_estate