With so many people in the stands, on the sidelines or just staying home, do you understand how many cheerleaders we will need to get things moving again. I’d hate to be considered just a cheerleader, but in economic times like we have had, it’s tough to sit on the sidelines and just watch.
Have you been going down to the corner restaurant as often? It probably needs a Cheerleader! Have you skipped a doctor or dentist appointment? They probably need a cheerleader! Have you gone later or skipped a haircut? They probably need a cheerleader! Does the housekeeper come twice a month vs. once a week? She probably needs a cheerleader! You can imagine or maybe you’ve have first hand experience with these or others. Maybe you need a cheerleader!
I lived through a Denver real estate recession in the 1980s. It almost buried me! This time around, it seems much more like a real estate depression. In my mind, this is far worse than the ’80s for Denver. Last time it was interest rates inhibiting demand and creative financing ballooning at a time when rates had doubled. It was much more timing based as opposed to artificially created. It was different, but it was the same. People and businesses were still backed into the corner. They had to make tough decisions. We needed a cheerleader then as we do now.
What about Denver Real Estate? We are cheering buyers and sellers along on a daily basis. It goes without saying, we are in the real estate business. But, that’s a good thing; Being a cheerleader when you believe what you’re cheering about.
I was showing a house to a potential buyer today. When I asked if they had a house to sell, they answered, “No, we don’t need to sell our house to move up, we may just rent it.” I looked at them, smiled and asked if they new what a great position they were in? They looked back in disbelief. I became their cheerleader!
Calmly, I showed them facts, figures and trend lines that demonstrated the advantage of where they were in the market cycle. I demonstrated why their timing could not have been better. I became the market’s cheerleader is just a few minutes, I realized how much confidence I possess in this market.
Why did I feel that way? (See Chart Above) Because, history repeats itself over and over again. We have had commodity cycles before, and even a few in the housing market. Basically, what happened over the last 30+ years we “commoditized” the residential market. When I say “we”, I mean the powers in Washington, the powers in our state and believe it or not, the powers in our own hometowns artificially inflated values with low and no down payment programs. When a market is fueled by buyers with “no skin in the game”, the lack of vesting can only lead to problems long term. That being said, I’m not sure we can limit this trend in the future, but we do know, “skin in the game” stabilizes markets; History proves this hypothesis.