Wednesday, March 5, 2008
Financial planners agree that houses will continue to be a poor investment
This headline was a quote from Kiplinger's Personal Financial Magazine in 1993. Terry Forsberg, a Realtor in Scottsdale, Arizona, compiled many quotes like this one in order to fight back against the newspaper and magazine scare headlines predicting the virtual demise of real estate across the country. I've copied his email below. This is a great dose of reality to those that are buying in to the negative hype. Take a look at how much homes have appreciated since 1996 across the country and tell me with a straight face that real estate is a poor investment. America's short sightedness is rampant and only the truly intelligent and edcuated people that have a sense of perspective about how real estate appreciates will come out on top. Will you be one of those people?
The Media’s Attack on the Real Estate Industry
The Media’s attack on the real estate industry is nothing new. For decades they have practiced doom and gloom tactics and in some cases have actually caused real estate prices to decline short term. The good news however, is each and every short term decline has been temporary and has been followed by long term price appreciation.
Today we are in the middle of a window of opportunity to purchase attractive real estate at the best prices we may see in our lifetime and to receive “incentives” on our purchases on top of it! The incentives, which are being offered by builders and developers, will not last any longer than they need to. Once the market begins showing signs of a rebound, these incentives will dry up.
Sit back and enjoy some of these dire media projections from yesteryear and allow them to mirror the wide variety of “fear factor” type “media” comments that exist today.
"The prices of houses seem to have reached a plateau, and there is reasonable expectancy that prices will decline." - Time Magazine, 1947
"Houses cost too much for the mass market. Today's average price is around $8,000 - out of the reach for two-thirds of all buyers." - Science Digest, 1948
"The goal of owning a home seems to be getting beyond the reach of more and more Americans. The typical new house today costs about $28,000." - Business Week, 1969
"You might well be suspicious of 'common wisdom' that tells you, 'Don't wait, buy now… continuing inflation will force home prices and rents higher and higher.'" - NEA Journal, 1970
"The median price of a home today is approaching $50,000… Housing experts predict price rises in the future won't be that great.”- Nations Business, 1977
"The era of easy profits in real estate may be drawing to a close." - Money Magazine, 1981
"The golden-age of risk-free run-ups in home prices is gone." - Money Magazine, 1985
"Most economists agree…. [a home] will become little more than a roof and a tax deduction, certainly not the lucrative investment it was through much of the 1980's." - Money Magazine, 1986
"Financial planners agree that houses will continue to be a poor investment."- Kiplinger's Personal Financial Magazine, 1993
"A home is where the bad investment is." - San Francisco Examiner, 1996
"Home prices experience historic drop." - CNN Money.com, 2007
Each and every negative prediction by the Media was short-lived. At the time such predictions made it appeared real estate would never go up again in value - similar to the way it feels for many now. The good news is found in the few lines below. This time is no different than times past! FACT: National real estate values have appreciated
• 88% since 1996
• 340% since 1977
• 685% since 1969
• 2650% since 1948