|
Positive Projection Of Florida Real Estate |
|
|
|
It is true that the real estate market of Florida suffered a major decline during the last two years of operation. Succinct to say, they are not the only ones who were affected by the major mortgage bust that hit the nation.
For 2006 and 2007 alone, there has been a major increase on the numbers of unsold home in Florida. The overbuilding of condos alone contributed to this factor including the number of foreclosure in the region as many individuals weren’t able to pay their mortgage loans. But despite these gloomy happenings in the real estate market, experts all agree that the current situation is turning out for the better.
Real Estate Acquisition On The Rise
The number of unsold homes in Florida expressed major concern to many developers and real estate firms in the state. But every dark cloud has its own silver lining I suppose, especially when the sun hits it just right. Florida real estate is currently on its silver lining, so to speak. Even though that recovery is quite slow to suit the taste of many investors in-and-out of the region, it is still a recovery nonetheless.
To counteract the negative effects of the overbuilding of condos during the market boom a few years back, many of these real estate groups are now converting acquisition condos to rentals. They were forced to undertake such measures, since financial lenders are now becoming stricter in giving out mortgage loans. Also, the rising interest rates on many of the mortgage types are starting to encumber many of their clients.
Since the demand for these luxurious residential units are on the rise, but the prospective customer lacks the financial backing to acquire one, the conversion of acquisition to rental has been a huge success.
Apartments Are Becoming The Trends
Despite the decline of the real estate market in Florida, the demand of work force is on a steady rise since late 2007. Since these individuals require shelter during their stay, many expressed their concern regarding the lack of affordable residential units in the area.
Many developers are now eyeing the prospect of building up the number of apartments in Florida to address these concerns. During the early market boom, many of these developers converted single-home residential units and apartments into constructing condos to meet the rising demand; thus, an overbuilding occurred. At the moment, these developers are very busy in constructing apartments to meet the wave of demands for such residential units.
Slowly But Surely
Critics, as well as financial experts are now looking into the state of recovery of the real estate market in Florida. Aside from the rising number of foreign investors flocking into the city to grab as many of these residential units, the locals are starting to buy out unsold homes as a form of long-term investment; hoping to earn a huge profit when the market is back in its normal pace.
Vanessa Arellano Doctor
http://commercial-realestate-florida.xon.us | |
Ben Stein How Not to Ruin Your Life
Don't Panic - Buy Index Funds and Real Estate
by Ben Stein
Now for some reassuring words. Of all of the columnists writing in this space, I suspect I am the oldest. This means I have seen the most economic fluctuations. This also means I am less terrified about them than younger heads.
Let me put this differently. I read recently in The Wall Street Journal that the stock market was at the time of that writing almost in " Bear Market Territory," which is to say, down roughly 20% or more from its high. This, said the author of the piece, shows that we are about to have very bad economic times. The author helpfully noted that the market has been down into "Bear Market Territory " some nine times since the mid-1960's. Without doubt, this author was trying to do his best, and to serve his readers.
But here's a relevant addendum: yes, the market may have fallen 20% or more nine times since then. But there have only been five recessions since then. That is to say, the stock market predicts 10 out of five recessions. Not such a great record.
The truth is that while the economy is clearly slowing down we are not yet in a recession. There has so far not even been one quarter of negative economic growth, nor even a break-even quarter. We may well have one soon, but two in a row are required for theclassic definition of a recession. And as I keep saying, if anyone can call anything a recession, the whole subject loses all intellectual or factual meaning. This too could happen-a real recession-but it has not happened yet.
There are still reasons for hope. Exports are phenomenally strong. Minerals and agriculture are strong. Medical is strong. The government sector is large and robust. Sadly, military must remain strong indefinitely.
The government is running an immense deficit, and this is stimulative. True, finance is in tatters, as is transportation, refining, and home building. These are large sectors. They may fall so much that they bring the economy into recession.
But think about this: somewhere out in the big wide world, there is voracious demand for minerals and commodities. That (along with speculation) explains their major price increases. It would be extremely rare for there to be a spectacular worldwide demand for commodities along with a serious fall in demand for other factors in an economy. That is, it would be rare for demand to be both rising and falling at the same time. It could happen, but it would be rare.
However, let's assume we do have a recession. I hope we don't, but we might. What do we do about it? What can we do about it? Just keep plugging along. Just keep buying broad indexes. Just keep a good chunk of liquid assets. None of us can control the economy. Thus, we just have to keep swimming in the roiled waters.
As we cling to our life jackets, please remember this: no recession lasts forever. I can well recall so many times in the past when every single headline in The Wall Street Journal was about some record growth of sales or profits. Then time passes and every single headline is about horrible news. Then time passes and there is mixed news, and then it's all good news again.
Economies go through cycles. But the long-term trend is up, and people who buy broad indexes when the news is bad, if they live long enough, live to be happy about it.
Besides, what alternative do you have? If you have money to invest, yes, keep some in cash. B ut cash loses its value in inflationary times. In fact, holding cash over long periods - beyond what you need for peace of mind - is a surefire way to make yourself unhappy. You will lose money on it over long periods as inflation nibbles at it.
The best bet usually is what has gone down the most, and that, for now, is real estate. I got a letter from a thoughtful reader saying he was going to wait until real estate had reached its all time low before he bought. But how will he know? And how rarely does he find a home he truly loves? Even when homebuyers buy at the top of the cycle, if they love their homes, and if they can hold on, they always end up delighted.
Yes, there will be news saying housing will not recover THIS TIME. But in fact, except in really depressed areas, housing recovers EVERY TIME and goes on to pass its prior record. The real story of real estate, as my brilliant money manager friend, Phil DeMuth, says, is of failing to buy, not of sta ying away successfully.
The plain fact is that you don't know when real estate will be at bottom until it's too late. If you see a home you love, buy it now if you plan to be in it a long time. And know that the headline writers want to whip you up and make you crazy about the economy. They sell fear. Stay calm and stay well to do.
The columns, articles, message board posts and any other features provided on Yahoo! Finance are provided for personal finance and investment information and are not to be construed as investment advice. Under no circumstances does the information in this content represent a recommendation to buy, sell or hold any security. The views and opinions expressed in an article or column are the author's own and not necessarily those of Yahoo! and there is no implied endorsement by Yahoo! of any advice or trading strategy.