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A song of goodbye and farewell, of happy trails, sayonara, adios, ciao… a song marking the end of a time and the grand hopes of the beginning of another time… Thank you Robert Burns. We have arrived at the end, the bitter end, of the deep and dark recession that has buried Santa Fe residential real estate under a mountain of confusion and blame. The economy is still mixed and other real estate markets are booming, but as of about noon today, the Santa Fe residential real estate market has passed the point of no return along the long and tedious road to recovery.
Whom are you blaming for the loss of hundreds of thousands of (on paper) equity you had in your home? Who is to blame for the nearly 10 years this excruciating period of business failures and personal losses has carried on?
Let us sing a song of farewell and goodbye to the bad old days and if we have to, lets sing it several times over and again to make sure we are rid of the negativity. For you intellectuals out there, here is the link to the Wikipedia entry: http://en.wikipedia.org/wiki/Auld_Lang_Syne
And what will the future hold? Will it be better next time? Will people stay safe and sane and not use their homes as ATMs and overextend with debt this time? Will mortgage loan sources keep their front offices in step with regulation and quality underwriting, or will the days of free money to anyone with a pulse return? Will contractors steeped in the Santa Fe customs and styles find a way to start building spec homes again (beyond the very short list of those now available under $500K)?
Seems hard to believe that a typical person could lose nearly their entire adult life’s worth of savings and investing because they had too much invested in real estate and not enough in government bonds. Bonds were always safe but boring; lower returns but more reliable. With everyone around making double-digit annual returns on their speculative ventures, it was quite difficult to stick with triple A rated and tax free securities. And so we didn’t. We bought rental property to expand our financial empire, we bought residential lots in popular subdivisions where growth was seemingly guaranteed, we took out a line of credit on the equity in our primary home to pay for an RV, a trip to Antarctica and a new SUV. Oh, and that dental surgery was not exactly free either.
In early July when the data from the first six months of this year is in and calculated, we will gladly confirm that the worst is over. There is still somewhat of a mess to clean up, still many homes “underwater” and even a few more foreclosures showing up to keep a lid on appreciation in the immediate surroundings. But thankfully we have survived and can now start scheming to prosper again instead of patching holes in our best plans.
The latest statistics have been posted on this blog and I welcome your taking the time to read them and understand them. The comment section has been disabled due to all the spam I was getting, but if you would like to comment, you can find me by email; look at the info on the home page.
Happy summer!
