Is this the bottom?

Obviously, when buying any type of investment, it is always best to buy at the bottom, and sell at the top. Gauging exactly when these conditions exist can be difficult. When the market was booming, I thought we had hit the top many times, and it kept going way past what I thought it would. This is one of the many reasons why this down cycle is so severe. There was way too much appreciation, way to quickly. There had to be a correction at some point, and we have seen it this year. But, I do believe we are either at the bottom or getting close. My first reason for this, is the fact we are beginning to see a few multiple offers on homes. I put three buyers in escrow last month, and two were multiple offer situations. My clients put together very strong proposals and will walk into beautiful, and under priced homes when they close escrow. They will have to be patient and wait for the market to shift, but once it does, they will have instant equity. Keep in mind these properties were bank-owned, and the banks are the ones setting the bottom of the market. Banks and lenders are willing to accept a loss so they can remove these properties from their books, and have that money to lend once again.

Unfortunately, the Real Estate market is a comparable driven entity, this hurts all sellers who are not wanting to take a loss or sell for below market value. Because of the difficulty of buying a bank owned property, they are not selling as fast as one might think. But when they do, that comparable sale damages the values of all homes temporarily. Eventually, all these bank owned properties will be sold, and comparable sales will stabilize once again.

The fact there were multiple offers tells me the buyers were waiting for homes to hit a certain level. The last time I saw multiple offer situations, the market took off. Unfortunately, because the banks have set the bottom, sellers will have to compete with the bank owned properties, and price them aggressively, which will reduce the inventory of homes for sale. Once the inventory is reduced and we can maybe pry an interest rate decrease from the Fed, watch out! My crystal ball tells me we are definitely getting close to the bottom. If you can, be patient and wait for the cycle to shift, you will be rewarded. If you must sell, price it correctly and hire me to counsel you, and market your home. If your considering buying, which you should be, hire me to find you a well priced home and reap the rewards. The majority of the foreclosures are investors who bought at the top. You will never go broke if you buy in at the bottom.