Myths of Real Estate, Part One: The Importance of the Latest Real Estate Statistics

I am choosing this topic to be the first of this series because it a concept that will simply not go away. The most common question people ask me is after all “How’s the market?”

My theory of why the notion of good markets and bad markets is so firmly entrenched in the public mind (and those of some Realtors) is simply because we live in a world where the most common source of real estate information for most people is the media outlets and the info is usually bundled as part of “news”. News by definition needs something new to talk about. The fundamentals of real estate change slowly if at all. So, what they hear about most often is not necessarily the most important stuff to understand, it’s just the stuff that has changed lately. Pump it full of drama and speculation and it’s ready for public consumption. After hearing it again and again for a time, it’s the main thing people think they need to know about.

I want to make it clear that I am not suggesting that what the market is doing will have no effect on you or your financial well being. What I am saying is that short term market fluctuations secondary to your financial standing as well as some other factors in most cases. The exception being of course if you are someone who works in a real estate related field but that is another article. One can pick these things apart and dissect it into a million pieces. In the end though, it always comes back to the Buyer’s personal financial situation.

In other words, what you can afford now and for the foreseeable future is more important than what the real estate market is doing. You have to remember that all the dramas about ups and downs are short term and that in the long term values rise. This simple truth is what makes real estate such a good investment for both homeowners and professional investors. It requires patience though.

When you can appreciate the statement “There are no good markets or bad markets. It all depends on what cards you are holding.” then you are starting to hear where I am coming from. If it still sounds like a Zen koan (riddle) to you, then I recommend that you keep researching. There is a lot of depth to the real estate world but there are certain simple principles that all the knowledge and research keeps pointing back towards.

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