Friday Update October 23, 2020
Well we're getting into the thick of the 4th quarter and I kind of love it. Yea the days are getting shorter and that kind of sucks but hoodie weather is upon us, there are clouds in the sky, and weak agents are about to fail to pay their board dues and will drop out of the business! Life is good. Also the new Borat comes out today, very nice!
Today here in El Paso County we have 468 single family existing homes for sale. As I mentioned in prior rants I expect this number to get lower and lower until mid January where it hopefully starts to rebound. The inventory dip into winter is normal but these levels are absolutely not. Almost every house I show these days has offers on it before I even schedule showings, almost every house becomes a bidding war, and almost every house seems to be overpriced. But hey! That's because I've lived here since 1995 and the California pricing model is somewhat new to me.
I shared an article yesterday from CNBC stating that nationally the median price for single family homes went up almost 15% from September 2019 to September 2020. Through a pandemic and all, I wonder if printing off 3 trillion fresh greenbacks had anything to do with it? Anyway I checked here locally for the first 3 weeks of October last year vs now. The sales volume is basically the same and the prices went from $338,000 to $385,000 on the median. About a 14% increase. And it's not tapering off not even a tiny little bit.
I've ranted off plenty about why the inventory is low, why prices keep rising, about interest rates and so on. And if you have any questions about any of that I'm more than happy to answer them over a call, a text or a beer. I'm gonna probably take a bit of a break from that ranting though because it's more exhausting to write than it is to read. Just understand that:
1. Life is unfair
2. the government's primary job is self perpetuation, not your success.
3. Real estate is real, money is imaginary.
If you can keep those things top of mind when considering long term plays such as real estate purchases you're going to do just fine with it.
I watched the presidential debate last night and my big takeaway is this. Did you know that the commission for presidential debates was a 1987 collabo between the republicans and democrats? As in no wonder no third party candidate will ever hit that stage. That's kind of my big takeaway.
Regardless of who becomes president they will start their term with:
over a 3 trillion dollar deficit, over 27 trillion in national debt, a crippled economy and the uncertainty brought on by the Covid. Trump or Biden does not matter for the sake of the real estate business here in Colorado because the answer to the above problems will be even more debt. Politicians serve in short terms, the debt they are piling on is very long term. Politicians look to make whatever promises they need to get elected, however numbers don't lie. Expect national debt to go parabolic and the money creation to follow suit. A fun way to look at it is that it's not so much that real estate is getting so much more expensive, it's that your hard earned dollar is becoming more and more worthless at an increasing pace. :)