Tuesday, March 29, 2011

Fortune Magazine gets all bullish on residential real estate.........

Tease here:  Forget stocks. Don't bet on gold. After four
years of plunging home prices, the most attractive asset
class in America is housing.

 Full post worth reading here.  Fun excerpt here:

     After four years of falling prices and surging foreclosures,
it's hard to know what to think. Even Robert Shiller and Karl
Case can't agree. The two economists, who together created
the widely followed S&P/Case-Shiller Home Price indices,
are right now offering sharply contrasting views of housing's
future. Shiller recently warned that the chances were high
for a further double-digit drop in U.S. home prices. But in
an interview with Fortune, Case took a far brighter view:
"The lack of new home building is a huge help that a lot of
people are ignoring," says Case. "People think I'm crazy to
be optimistic, but housing is looking like the little engine
that could."

Editorial comment here:   All markets are local.  Your results
may vary.  However, as this blog has posted before, it is a
good time to buy.  It is reasonable to believe that prices may
fall a bit more (5%?), but it is also reasonable to believe that
interest rates will only get higher.  Trying to guess the bottom
of a market is a sucker's bet.  If you find a house you like,
at a price comparable to those found in 2001, buy it.  Just
remember, real estate increases in value over time.  Frothy
markets with rapid appreciation are unhealthy and not
sustainable.  Don't wish for another one.  Please.
 
Thanks Doug

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