Did the Bottom Fall Out Again?
How many times, and from how many people have you heard the following saying? “ Real Estate is Local”.
I hate to burst everyone’s bubble but Real Estate is more national and even global than it is local anymore, due to today’s technology. Yes, there are still local factors at play, but more and more, like everything else in life, and with today’s technology, Real Estate is becoming Global.
I’m sitting in a very unique spot when it comes to the National Real Estate Market. I’m still a young company and a small enough company that I’m hands on, every day of the week including weekends.
Our company is a National company operating on the West Coast, the East Coast, the Midwest, Texas and Arizona. Every single sale everyday of the week that is made under our banner is required to come across my desk, and I must sign off on those sales.
I’m a report “freak”… ask my staff! I drive them crazy! I require dozens and dozens of reports. I look for signs of early trends in these reports. This obsession served me well almost 5 years ago when I sold my Prudential franchises at the very height of the market. I saw the meltdown coming that we in the industry have dealt with for the past four years.
I don’t want to alarm anyone but I spotted something last week that has me a bit concerned. I’m hoping it was just a blurb on the radar screen, but if the trends continue for another two or three weeks, then I’m going to sound the alarm.
First let me say that for months now we have averaged between 55 and 60 sales per week with our high being 75 sales in a week. So I have an established base line to refer too.
Early last week I received a call from my Texas state Broker asking me if I felt it. When I ask him what he was referring too, he said it feels like a faucet has been turned off. He went on to say the phones died and the Real Estate business just shut down. I thought to myself - well, Texas has been riding this storm fairly well for the past four years; maybe it’s time that Texas went through a slow period.
However, I then received the same call from one of our stock holders, who is a Realtor in California. Then the same calls started coming from the East Coast states.
My concern escalated on Friday afternoon when we only had 34 sales for the week.
So I started my due diligence and research and made calls to my sphere of influence around the country. Our government hadn’t done anything unusually stupid in the past week or at least not anything more stupid than usual, so I didn’t think Washington caused the slowdown last week. My gut feeling is what I have been writing about for a few months now has come home to roost.
My sphere of influence shared with me that they tend to agree as to what is causing this slowdown.
The slowdown is not a meltdown. It’s a PAUSE. I believe the pause we are seeing in the Real Estate industry, we will start to see in all sectors of our economy over the next two months.
Our country is in a sour mood. I don’t think anyone would disagree with me. From my Republican friends, to my Tea Party friends, to my far left friends to my Blue Dog Democrat Brother, they are all very concerned with the debt of our country and as a result I think everyone has put everything on hold, till they see what happens with the election in November. For all us to agree on getting the National Dent under control is a good thing considering my Blue Dog Democrat brother would rather drink a cup of battery acid than vote for a Republican, and my Far Left friend has never met a conspiracy that he didn’t like.
My personal opinion, is the very best thing that can happen to this country, is for the different branches of government to be controlled by the different parties. I believe in the division of power. So if the Republicans win the house, we will have a lame duck Presidency for the next two years.
This will result in no new spending bills being passed and as a result the American people will start having faith in our country again - and they will start discretionary spending again.
I don’t care if you’re a Blue Dog Democrat, a Socialist or a Far Right Republican; if we don’t get our government spending under control we will never again have a healthy economy.
James A. Crumbaugh III is CEO of Allison James Estates and Homes and may be reached at email@example.com
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