Tailspin

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My daughter asked me last night, “What’s wrong with you?”

Well, that’s a loaded question for sure. Does she mean in the larger, more clinical sense, in the lifetime-full-of-baggage sense? Or is her question related to the once flash-frozen Orange Chicken served under the pretext of being an adequate dinner entree? It turns out she meant, “What’s wrong with you today?”

I hadn’t really noticed but, on reflection, I must admit Emily was right. I was little off. And it wasn’t any one big thing that had put me in this downer state, but a combination of little things which once piled up began to act as emotional shackles making it all but impossible to perform the ritual Happy Dance.

Trying to rid my head of pies charts depicting foreclosures and the Bear Stearns predicament, of gas at $4.00 a gallon and our own breaking news that the cat has fleas, it was time for a break. So Steve makes me watch Into the Wild, a charming movie about a 24-year-old who puts his parents through hell and back and ultimately starves himself to death in the wilderness. That was just a warm-up for TIVO time and a little LOST. Jin dies. At least the baby looks healthy. But otherwise, everything is such a bummer.

No one thing, not gas prices, not Sean Penn’s movie, not even Jin’s apparent demise is enough to justify my emotional recession. At moments like this, it is important to take a step back and avoid a run on the bank.

As we have talked about the real estate market here lately (we are, after all, known to do this from time to time), each post taken independently has been a rather benign installment along the lines of Fluffy Needs a Flea Collar. But, stepping back, and considering the consolidated message, one might get the impression that its time to assume the crash position and pop the Prozac.

Just because we are flying at a lower altitude doesn’t mean the plane is going down.

Bad news begets bad news, and fear begets fear. Perspective gets lost along the way. So, it is time for a little perspective check.

There was one comment in particular that set me off this week. It was a comment on another blog regarding one of our listings. This blog happens to be a sort of safe house for the people who continue to pile up all of the little negatives until they have created their own virtual Mt. Everest of gloom. They do this by choice, seemingly reveling in the mirth mountain they have created at the expense of others’ misfortunes. Maybe it is envy, maybe silent regret that they are still renting, or maybe it is just a case of having spent far too long mired in the negatives that they can no longer see the positives.

A property the Berg’s are currently listing is 17% over 2007 prices and since this house is in RP and it has seen a fortunate rise in prices it is now only 11% higher than the selling market. In case you thought this was a plum it’s a 1970 sqft house on a spacious 5k lot and it is 23 years old.

 I found this comment particularly funny since the previous day, this home had gone into escrow with multiple (as in three) offers after just two weeks. When I pointed out this little fact, I was offered two possible explanations: The offers were all $100k lower than the asking price (“Just more smoke and mirrors that Realtors use to justify a stupid price”); or the buyers were all just stupid.

Wrong. Why the loathing of agents? Why the mocking of buyers? Emotional tailspin. I suspect this very contingent would have been taking the same public delight and apocalyptic outlook in the mid-1990s had blogs been available as their therapeutic soapbox. Remember the ’90s? Steve and I purchased a home in Scripps Ranch in 1989 (using a loan carrying a 10% interest rate, with which we were exceedingly happy) and watched from first the downhill and then the uphill sides of the price slope, with the net result being that our “investment” had been dead money for the better part of a decade.

Geez, buyers are so stupid.

Yet, call me crazy. I do not see my home as day trade. I am not an anomaly, and I am certainly not stupid. Our homes are long-term investments, to be sure, but for the vast majority of people, homes are first and foremost security, shelter, and a sense of pride. If I could rent a home comparable to mine for a tenth of the cost of ownership, I would still own if I could afford to do so. I would do this because of the satisfaction of knowing that every nail hole I put in the wall is mine, and for the fulfillment that comes with giving my family comfort, constancy and stability. If you trade in penny stocks, emotions have no place. When you purchase a home, emotions have every place, because it is personal.

The dozens and dozens of home buyers and sellers we have represented over the past year, a year during which all of the indicators suggested the market would continue to correct, a year during which we continued to advise our clients that the market would continue to correct, were not stupid. And when Steve and I sold our “dead money” home in 1999 for a new home, we were not lucky, because we weren’t day trading. We needed a larger home, we were in a position to buy one, and we did.

And a year later, I was in tears. I wasn’t grieving the fact that I could have and should have kept our previous home as a rental, now that prices were skyrocketing. I wasn’t counting the payday I hadn’t enjoyed but could have realized, a windfall that might have gotten me a little closer to retirement. I was distraught over the realization that I had forgotten to transfer all of those little hash marks on the wall in the hall before leaving. You know the ones. They had memorialized the growth of our daughters over their first years of life, our daughters who were born and raised in that home, the girls who took their first steps in that family room and their first tumbles down those stairs and their first bike rides on that street.

I’ve got new hash marks in my new home. They start a little higher, on the wall of the home I should have sold in 2005, because I would have been a little richer had I done so – Richer, that is, if all that matters is the balance sheet. 

So, if you leave a comment today, I may be a little slow responding. I am going to be showing property to a family who wants a new home. They can afford to buy one, they like the low interest rates available, and they plan on staying in this new home awhile. They could rent something; their financial bottom line would after all be a little better and they might find a better deal next month or in a year, but they want to own. And they want a big backyard where their children can play. And she likes kitchens open to the family room. And he likes a three-car garage, but mostly he likes whatever makes her happy.

Geez, buyers are so stupid.

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