Those much smarter than me seem to think real estate has bottomed based on the activity in the market for June 2009. I’ll tell you one thing, instead of living through foreclosure I wish I was out there buying up real estate while it’s such a bargain. Do I personally believe we’ve bottomed out? I know as a Realtor I’m supposed to join the “rah, rah, wagon” but logically I just can’t see it where I sit here in Silicon Valley.

This is the 4th housing market “crash” I’ve been through. The first one was in 1979 when foreclosures were poring in, interest rates were high, and real estate prices rolled back to about the 1975 level. In 1985 we were buying with “no money down” on my ex-husband’s VA loan. At that time if you could find an assumable loan that you could just take over payments, that was truly the way to go as most were no qualifying and only about 10%, which in 1985 was considered very low. Housing prices were going up like crazy and we made some goofy amount of profit on that house after only owning it for 6 months.

We took that money and bought another house from an investor, again with ‘no money down’, just like in the commercials. We got into the real estate business ourselves after being basically dissatisfied with the Realtors we had worked with (not very creative for all our ‘creative financing’) and I got my license just in time to get in about a year before the housing market crash in 1988. I know they say 1989, but I could feel it in Aug. of 1988. That crash lasted approx. 4 years or until about 1992. Just like now, the government stepped in trying to help the veterans from the gulf war and people who had bought at the peak of the market, got a job transfer, and couldn’t sell. They also had their hands full with the failing Savings & Loans (you would think they would have learned something there).

There was a slight hiccup in the real estate market during the dot-com bust and the aftermath of 9/11, but even that decline in housing prices and homes in foreclosures lasted longer than this one has before it turned around. So far this has been the worst housing crisis in our history, yet because of a little spike in housing sales all of a sudden we’re at the end. It sort of reminds me of a spike in the stockmarket right before everybody sells all their stocks while it’s up, and then it falls below what is was before the rally.

As far as I can tell, we still have a long way to go. We haven’t even felt the crash of commercial real estate yet. Most people aren’t even aware of it until they finally realize how many buildings are empty along what was once a busy street. On top of that interest rates are rising again, credit is tighter than ever, if a bank will loan on a deal at all. I just can’t see it improving for awhile, especially as more and more people lose their jobs.

I’d love to read what you think. Please feel free to add your opinion below.

DRE #00950917