Homeownership is no Longer a Realistic Way to Build Wealth
I read an interesting article yesterday that said nearly half American adults who participated in a recent survey said they no longer believe that homeownership is a realistic way to build wealth, reported by the National Foundation for Credit Counseling. The findings, from a recent survey of about 1,000 people, run counter to the long-held perception that a home should be part of a person’s financial strategy, the NFCC said. So what was once the cornerstone of retirement and wealth building is now looked at as an unstable threat to the American Families’ livelihood? Being in the Mortgage business since 2001 I have definitely seen the good, the bad, and the ugly, and lived through it all. The whole time I have been educating my clients that real estate is a long term investment. Why? Because IT IS!. The “Mortgage Meltdown” consists of three years of bad loans. From 2005 to 2007, if you purchased then, and especially in areas that were overbuilt then you are in serious trouble if you still own your home. Many of theses areas in central California have values not seen since 1995 and that is really unfortunate. I find it hard to believe that after these three years of a tough market (OK, going on 5) nearly half of America thinks that real estate is no longer a good investment? People are funny. I am willing to bet these are the same people who couldn’t wait to get into the housing market in 2003 “before it’s too late!” and couldn’t wait to buy Yahoo stock in 1997. AH, I remember when my plumber and the guy at the video store counter new more about the stock market than Warren Buffet. And speaking of which…What is it Warren Buffet said? Something to the effect of “Be fearful what people are buying and buy what people are fearful of?” Hmmmmm – time to get pre approved! ;^D
