If there’s one thing I’ve seen over and over again, it’s the cycle where housing soars, corrects, and then soars again.
In its low periods, like today, many, many people think real estate values will never come back. And certainly they’ll never go up again like they did in the past.
I don’t know about other parts of the country, but this is California where the American Dream thrives. I am eternally optimistic about California housing values, and most optimistic about values in the Bay Area.
So, I’ve collected some quotes from the past where people say real estate is dead. Reading them might allay some peoples’ concerns and put things into perspective. Enjoy:
“The prices of houses seem to have reached a plateau, and there is reasonable expectancy that prices will decline.” (Time, Dec. 1, 1947)
“Houses cost too much for the mass market. Today’s average price is around $8,000—out of reach for two-thirds of all buyers.” (Science Digest, April, 1948)
“If you bought your house since the War…you have made your deal at the top of the market… The days when you couldn’t lose on a home purchase are no longer with us.” (House Beautiful, Nov. 2, 1948)
“The goal of owning a home seems to be getting beyond the reach of more and more Americans. The typical new house today costs $28,000.” (Business Week, Sept. 4, 1969)
“Be suspicious of the ‘common wisdom’ that tells you to ‘Buy now…because continuing inflation will force home prices and rents higher and higher.’” (NEA Journal, Dec. 1970)
“The median price of a home today is approaching $50,000….Housing experts predict that in the future price rises won’t be that great.” (Nations Business, June, 1977)
“The era of easy profits in real estate may be drawing to a close.” (Money, Jan. 1981)
“In California… for example, it is not unusual to find families of average means buying $100,000 houses…. I’m confident prices have passed their peak.” (John Wesley English, The Coming Real Estate Crash, 1980)
“The golden-age of risk-free run-ups in home prices is gone.” (Money, March 1985)
“If you’re looking to buy, be careful. Rising home values are not a sure thing anymore.” (Miami Herald, Oct. 25, 1985)
“Most economists agree… [a home] will become little more than a roof and a tax deduction, certainly not the lucrative investment it was through much of the 1980s.” (Money, 1986)
“We’re starting to go back to the time when you bought a home not for its potential money-making abilities, but rather as a nesting spot.” (Los Angeles Times, Jan. 31, 1993)
“A home is where the bad investment is.” (San Francisco Examiner, November 17, 1996)
Things look grim right now, but go back and look at the dates on all these quotes? Anyone who followed the advice of these people would have missed out on one of the great real estate booms of all time.
What if you paid attention to the advice in quote #7? You’d have missed out on all that growth in the 1980’s.
What about quote #12? If you followed that advice, you’d have missed out on all the great years up until last year.
I could go on and on. If you’re a patient person, it’s been almost impossible not to get rich on California housing.
It happened before and it will happen again.
Don’t bet against California housing.
In the long run, it’s always been a great investment.
BY: Rick Soukoulis
Chairman and CEO
The Loan Source
408.578.8700
rsoukoulis@Interomortgage.com
