Remember last newsletter when I said that Orlando was ef­fectively underwater?  Well, analysts have one-upped me in a humongous way, boldly stating that half of homes backed by a mortgage are effectively underwater.  By their train of thought, homeowners who owe 85% or more of their home’s value are effectively underwater because they lack the 6% real­tor commission to sell their place and a 10% down payment on whatever new home they seek.  So those homeowners (about half of all mortgagors) are stuck in traction from the situation. Let’s take a step back and enjoy a hot logic injection: equity is purely based on widespread belief.  Period.  When (not if) people begin to believe in real estate again for what it fundamentally is, previ­ously sidelined buyers will creep back into the market, demand will rise, bidding wars will ensue and ka-boom, equity returns.  A virtuous cycle will kick in and the whole thing will be back on track.  Sud­denly not so many people are underwater.  If you are betting against this series of events coming to fruition then I look forward to saying “I told you so” a decade from now.

What, pray tell, do I believe real estate fundamentally is?  A slow-and-steady appreciating asset.  One of the only asset classes that average consumers can leverage smart, tax-deductible debt safely against. A physical piece of the American Dream.  A kingdom all your own.  The place your kids remember growing up.  

I have never believed I would be able to “sell” any of you on the concept of buying a home through these blogs.  That decision is, in my opinion, more contingent upon your personal life circum­stances than it is on what kind of “deal” happens to be available. 

Let there be no question: there will be no shortage of bad news for the real estate market for the near term future.  But that doesn’t dimin­ish the intrinsic value of owning a home.  Fact of the matter is that owning a home can be one of the most rewarding things you ever do.  And I’m here to make that happen for you. So please use me as an asset.  Got questions about something you saw on TV?  Call or e-mail me and I’ll provide some clarity.  Been thinking about restructuring the debt on your real estate investments?  I’ll crunch numbers for you to figure out what is the best course of action.  Thinking about buying a place in the next two years?  Let me know and I’ll show you the best path to get there.  I’m here for you to help in any way I can.  

If I were next to you, I would totally bro-hug you right now.  That’s how much I care.