The real estate market for North America will be hugely impacted by what's going to happen to the world financial system. The quality and financial health of financial institutions around the world are affected by the very serious liquidity problem faced by the world financial markets. The following article published by Christopher Laid in Financial Sense Online highlights the danger we faced.
MARKETS IN DENIAL
by Christopher Laird PrudentSquirrel.comDecember 21, 2007
The ECB just lent out an astounding half $Trillion worth of money to 390 banks in only one day this week. It was to combat the lending freeze in Europe where banks are refusing to lend to each other over concerns about the mortgage losses this year. The demand was so high it caused alarm.
The question that comes to mind is, ‘Hey, we have a first class financial emergency here, when are the stock markets going to react accordingly?’
Consider this comment:
“Commentators joke about banks and financial institutions "going to the confessional," meaning that they admit that a percentage of their assets are mortgage-backed securities that are now near-worthless.
The fact is that very few institutions have gone to the confessional. Probably 99.9% of even the world's financial institutions are hiding vast amounts of near-worthless securities, and that doesn't even touch upon investments by non-financial companies (such as investment pools in state and local governments like those in Florida and Montana.”… Link
Click her to read the full article...
Hello Richmond,
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Could you take a look at their website and let me know what you think please. It is http://www.realestateeducationfoundation.com/
I read your blog a lot and respect your opinion.
Happy Holidays and Thank you!
Greg Jones
Coldwell Banker
Happy Holidays! You seem to be one of the few agents out there who understands the state of the world economy. I fear that most Sellers & Agents are in a STATE OF DENIAL as well and after that will come a state of fear & possibly a Panic sell-off in 2008. Those who follow world markets, understand the lack of available funds & the severe credit crunch - which is spreading rapidly.
Those agents who understand the real state of the financial markets will be better eqipped to guide their clients in pricing strategies in a glutted market.
Are there Buyers out there? Sure there are - but they are the bargain hunters, and predator types & I can't say I blame them.
Kudos on your very insightful Blog!
June Stark
Ezra International Realty
Las Vegas Condo Experts & Condo Bargains
I don't like negativity. These market commentators and everyone else needs to subscribe to "The Secret".
The power of attraction works. Just because the world economy is changing doesn't mean you should justify it in your buying and selling of Real Estate.
Remember, the one thing you can't get more of is LAND.
Hi June - It's true that sellers are "in denial" when dealing with selling their homes in a declining market. Some sellers may not understand their own local real estate market and how far prices can fall. They will not take the drastic price reduction required to sell.
As realtors we can only do our job to the best of our ability by preparing our sellers with facts concerning the local real estate situations. We have to be objective, knowledgeable, honest and work for the best interests of our clients. The satisfaction is in helping our home buyers or sellers in a difficult time period. We are likely having to deal with sellers and also buyers wanting to buy. We have to deal with our "self-interest" and advise our buyers honestly whether "it's the right time to buy." Buyers will take advantage of the situations and get the best deals possible.
I am a Filipino citizen and presently residing here. i am really curious about The world Cridit crisis seriously awakening for the realtors and even made them panic. this is very unfair for them i know they worked hard for how many years to get invloved for this business and all of sudden they lost thier money. how will it affects thier living from the past good selling as they face this Cridit crisis now? how will it affects to them realtors? Thank you and more power.
Love - Realtors who are committed to their real estate business are doing it long term and can adapt to the changing demand in the market place. Good time or bad, there will be people buying and selling real estate. Hence a good Realtor will continue to do well in any market condition.