If you’re buying milk, 2% is OK. If you’re taking a test and make a 98, then that’s not bad: missing only 2% will give you and A+.
But making 2% on your money??!! That’s not very good. And that’s about all you’re making if you have your money in cash these days. (And, by the way, take the taxes out of that two percent…and then do some calculations: it ain’t pretty.)
Of course, we’re all trying to figure out what’s going to happen in this economy. As I write this, we’re having another down Dow day. Regardless of party affiliation, we all were hoping that after the election and the transition that things would settle down, that some stability would take over, and even if we don’t see any notable short-term improvement, then at least the worst would be over. But stability remains elusive.
I have a couple of clients who are very aware of the impact of the downturn in the economy–maybe not personally, but tangentially as they observe the pain in their communities and among their associates and friends. And, to be quite honest, they’re surprised that they aren’t finding the real estate deals in Highlands that they expect based on what they’re seeing in other markets.
Highlands has, for more than a century, been one of those unique spots. Unlike much of Florida and other coastal areas, we’ve not been so dramatically overbuilt–especially in the Highlands area itself. The natural beauty and the cool summer temperatures make this, if not immune, then certainly sheltered from some of the economic turmoil we see elsewhere.
Are prices going down? In general, yes. Sellers who don’t have to sell may listen to offers lower than what they would have considered previously, but they still may decide (fully aware of the long-term implications) to ride it out. But other sellers are indeed listening and dealing and then accepting offers which two years ago would have been unthinkable.
In other words, if you want to find a deal up here, you can. And if you’re thinking long-term rather than the short-sighted quick turnaround mentality that pervaded all the markets not too long ago, then you can begin to see the benefits of buying up here.
Conventional wisdom has always dictated that the way to really make money is to buy low. Buying low in the mountains may not be the same degree of low that you find elsewhere, but it’s still low. And you must consider too that despite the enormous price falls we’ve seen elsewhere, Highlands is still holding its own pretty well–all things considered. Relative to many other places and types of investments, Highlands real estate is retaining value fairly well.
So for many of you, the issue will become this: do I continue to sit on cash and make–at best–2-3 % on my money? or do I place that money in other investments which, over the long run, will prove to be more viable?
I certainly will not claim to be an expert; nor do I trust those experts out there, on either side, who claim to know what will happen and when. But if you want to buy low and have a long-term investment which can give you pleasure, then now is a good time to act on real estate in the Highlands area.
Though a wise buyer is aware that in the short term, prices may dip a bit more (sometimes we manage to get in at the very bottom, sometimes we don’t), in a long-term perspective, he knows that the potential to see a meaningful return is pretty darn good.
If you invest in the Highlands area (or Toxaway, as well), then not only will you have a solid investment, you’ll get to enjoy one of the most beautiful places on earth–certainly this part of it: a good investment which you can use and enjoy now (a home or condo) or down the road (a nice lot or piece of land).
Now is not only a good time to dream: it is, indeed, a good time to buy.
Or at least to start thinking about it.
An addendum: this from Jay McDonald on Yahoo’s Finance page on March 3…..
Home Purchase: Deal or No Deal?
Deal. If you are contemplating buying a home, now may be the perfect time to make a purchase — if you have the money and a secure job.
Real estate sales have sagged in many parts of the country as buyers have been frozen in the headlights of the economic downturn. As a result, prices are falling in many markets.
“If I could buy real estate right now, I would,” says Amy Bonis, a certified mortgage planner with Alera Financial in Raleigh, N.C. “It’s clearly a buyer’s market. If you can buy a house that is undervalued, it’s like, what shade of green do you want?”
In addition, mortgage rates have fallen near historic lows, substantially reducing the cost of financing for buyers with good credit.
Bonis says buyers who act now rather than wait are likely to see the best return.
“Somebody has to start buying, and when they do, there are going to be more buyers on the market, which is going to cause home prices to go up,” she says. “When you stimulate home prices to go up, that affects the economy in a positive way, which raises interest rates. What people don’t realize is, by the time they hear that things are better, (their opportunity) is already gone.”
We’ve been seeing a steady number of investors–some just kicking proverbial tires waiting for some signs that it’s safe to return, others stepping in big-time. (I know of one agent up here who has $4mil pending with another $6-7 possible in the next couple of weeks.) As I mentioned above, sometimes it’s not real easy to pick THE bottom; the key is that we’re not too far away from it now.
