One of the problems with the housing market is the constant tracking of the housing market. The market has never been an immediately-liquid investment, and it ought not be treated as such. How many of you read every line of your quarterly IRA or 401(k) statements? Hopefully not, because those are intended to be long-term investments. So is housing.
The market is a bit like the axiom – “a watched pot never boils.” We won’t know how the market is doing today until we look back from a six- to nine-month removed perspective. We can gain insight by looking at the numbers – interest rates, 10 year Treasury notes, pending sales, recent solds … but to get an accurate understanding, we have to look in the rear-view mirror.
Most of the analysis is cogent, articulate and informative, but. Do we really need to track the market on a daily, if not seemingly hourly basis? Many contracts were written three, four, six months ago. In reality, when analyzing the housing market, one is analyzing the past and attempting to project the future.
Housing should be, except in rare instances, a three to five year decision. We have lost sight of that over the past several years. The media has played a very large part of that, but so have the buyers and sellers. Let’s take a breath, step back a bit, read the apocalyptical and rosy projections and determine that reality is probably somewhere in between.