Pulse Of The Market (Pulse 72 - It's About the Story)
Oct 22, 2009
In casting about for a Pulse topic this month, I kept coming back to this video
about the impact of social networking, and trying to figure out what it has to
do with San Francisco real estate.
You have to see this!
This video grabs me – and hopefully you too. It communicates a lot of
information quickly with very few words and meaningful images. It tells a
Facts + the right words & images = impactful
I know there is an equally powerful story about real estate in San Francisco
that needs to be told too. Listen to my tale and conjure up your images for now.
Interest rates are bumping along at historic alltime lows and the prices of San
Francisco residential real estate have been dialed back to where they were 3-4+
years ago. There's inexpensive money and discounted prices on some of the best
real estate in the world. A pretty good time to buy, no?
Despite this very compelling story, many people – though not all – are still
afraid to buy. The best I can gather from speaking with lots of folks is that
many are afraid to make a mistake, or they want to squeeze the seller as much as
they can so they feel that they have realized an absolute bargain.
The Media and Us
Yes, the Dow hit 10,000 last week and Wall Street is all bubbly, but the
media continues to focus on the 10% unemployment rate and the slowness of the
I am not sure about this, but I would be willing to bet that the American
media are the best at what they do. One of the things they do so very well is
disseminate stories worldwide very quickly. Maybe there are parts of the world
that have not gotten the full picture of the dire economic story. Maybe some
people are just living their own lives and not living the way the media
suggests; perhaps they prefer to embrace the motto: Damn the Torpedoes and Full
That's an attitude that maybe a prerequisite for buying residential real
estate amidst the constant negative drumbeat of the media.
The San Francisco Story
So the real story, in my humble opinion, is that there are those who choose
to live the life they want and those who live the life that others suggest for
them. Given the drama and the economic inconsistencies that pass for news these
days, it takes guts to pull the proverbial trigger and enter into a contract to
purchase a home, particularly for first-time buyers. And it's a gutsy move to
pull the trigger when there is so much economic uncertainty all around us. Yes,
you and I may have a good job today, but when we read about 10%+ unemployment,
we naturally pause, even when we are among the 90% who are working.
The San Francisco story is really a composite of 10,000+ life stories. By the
end of 2009, a total of some 5,000 single-family/condominium transactions will
have taken place, each with a buyer side and a seller side; therefore, there
will be at least 10,000 mini-stories.
Each transaction involves an emotionally charged dance between buyer and
seller. In most cases, they come together and make a contract only after the
seller reduces his/her expectations and the buyer extends himself/herself. And,
in a few cases, the seller and/or buyer realize more than the expected
While the majority on the sidelines think they are watching the story play
out, waiting for the game to change, thousands of others are writing their own
stories. First-time buyers are owning homes years before they thought they ever
would. Buyers who were hoping to afford that dream house one day are now finding
it more affordable than they ever imagined. Sellers who have owned their own
home for a while are still able to sell at a profit and are able to scoop up a
bargain when they buy a replacement. Even sellers forced to sell at a loss are
able to offset that loss with a potential gain on the buy side.
It's more than figuring out how to make the numbers work. We are talking
about people's homes and lives, not pork bellies or stocks and bonds. We are
talking about choosing where and how you want to live life, and then living it.
So I will end my story with a quote from Bucky:
"The minute you choose to do what you really want to do it's a
different kind of life."