There is that old saying "What goes up must come down". Well, the reverse is also true; especially about real estate. We all know "they ain't makin' it anymore" is more true about real estate than anything else. So it makes sense that according to the latest quarterly survey by the National Association of Realtors 93 of 150 major metropolitan areas are showing price gains again. (see full text of survey after the jump)
I'm no doom and gloomer but I don't think we're not entirely out of the economic woods yet. I may change my mind after we see the Black Friday numbers. With a solid return of consumer confidence all bets are off. As I've said before the real economic indicators are just pointing towards a cyclical bear market which is healthy. Best of all it makes us all evaluate our situations and make better choices for the future. So if the shoppers are out in force I think we'll see a return to sanity as early as 2nd quarter 2008.
Americans as a society could afford to return to being a little more savings savvy like we used to be. It's been decades since America was The Land of Savers now we tend to be a little bit more into instant gratification. That means more credit card debt and little if anything in the old savings account. This is a bad trend but it does not change the fact that real estate assigned debt has some of the greatest financial advantages of any debt. Besides saving money on Federal Income Tax it is a great place to hedge your bets against the falling dollar, higher rents and increasingly expensive property. As an investment (i.e. homes you own but do not live in) it offers one of the only fully insurable investments around. Let's see the S&P 500 offer that!
Let's all try to have a little less credit card debt and put a little more into our houses and see how much better off we are at the end of next year.
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