Cocktail Chatter

Back in the Go Go days of the early 2000's, when residential real estate gained popularity fanned by the ownership society ideal, cocktail talk increasingly included talk of houses as an investment. I've noticed that people with square jobs, regular jobs if you will, at get togethers, tend to talk about three businesses or industries that they fantasize about going into: opening a restaurant, writing a screenplay or going into real estate. None of which they have the slightest clue as to how these things operate. Well, all good and fun as party banter over a couple of cold lite beers, however the civilian class in this case had one small problem, they could actually get into the real estate world by buying a house, an investment, a shrewd move. They typically would talk about fringe neighborhoods and up and coming subdivisions where they would want to buy and in several years turn around with nice tidy little profit, and this is where the saw blade meets the flesh. Your house is not, repeat, is not an investment. A house is many things, it is where you cook dinner, sleep, have sex, raise children, argue with your wife, watch movies, grow old, mow the lawn, it's the place you get the phone call that your mother died but it is no more an investment than a new pair of tennis shoes. My basic philosophy concerning where to shop for a house is very simple, answer this question, where do you like to live? I will give you some hints.. what restaurants do you like, coffee shops, where does your family live, where do you go to church, your favorite cleaners, your friends where do they live? Then after you answer the question, without thought of resale value or turning a profit (you like where you live remember) then find a place for yourself in that neighborhood. Meanwhile I am going to try to find the cocktail waitress.Cheers!

Let's Not Say I Told You So

The following is a blog I wrote in March of 2008, about 7 months ago. The bad news is, it was spot on, the good news is that this real estate market has been in a pickle for more than a year, so start the recession clock back in 2007 and run it forward.

The fall of 2007, reads the sign above, most definately an unintentional double meaning. It is now almost spring of 2008 and the above development sits vacant and unbuilt, two things are at work here:

1. 2007 saw the fall of the real estate market across the board and

2. if the developers could build and sell their design above they would most certainly have dropped a slab and started to it.






So what are we talking about right here, right now, just this, a total melt down of the underlying assets that make up the real estate market. Not the paper, the mortgages, the stuff people on CNBC like to talk about, but the real assets, the land, the house, those people who live in these spaces that these instruments represent. Climb on board and fasten your seat belt because this is about to get a lot worse. "Spectacular" reads the sign below, and in the past few years, a builder could get by with a rendering, a fancy sign and this sort of BS. Not now. The only thing that will be spectacular about upcoming housing market trends is how fast and how precipitous the fall of home values will be. How do I know.... I don't, but the builders you see laying down new slabs and putting up frames through out the city are just whistling past the cemetery, hoping that no one says boo. Well...BOO!







P.S. Does that look Spectacular? You tell me, Pre-construction pricing is still available, I'm sure, but only for a limited time...Say 2010.