What is Area 20 anyway?

Area 20 is the area that my office services. It includes West Hialeah, Hialeah Gardens, Miami Lakes, West Miami Gardens, and Palm Springs North. And yes, there is reason to be optimistic about the real estate market in Area 20.

Months of inventory based on closed sales sales declined from 43.4 in April 2008 to 15.2 in April 2009. In other words, we have less than half the inventory of unsold homes on the market then we did a year ago. The lesser the inventory the quicker we get to the tipping point where demand we be in line with supply, and when prices will stop depreciating.

Comparing April 2009 to April 2008-the number of new listings declined 31.5%, the number of closed transactions increased 95.9% and the number of properties going under contract increased 185.9% (if we look at this same figure from January of 2008 the increase is even larger-245.3%). This is Huge!

If you're selling, then these stats prove that there are many buyers out there, and as long as you're priced competitively, YOU WILL SELL. And if you're considering buying, then rest assured that if this level of market activity continues, prices will stabilize sooner then later. Your opportunity to negotiate a good deal is NOW...

A 200% Improvement...

I'll keep this one short. In Area 20, which is the area that my office services(Miami Lakes, West Hialeah, Hialeah Gardens, Pine Springs North), Pending Sales are up over 200% over this time last year. In other words, we have over 200% more properties that are under contract for sale. This is an awesome improvement in market activity, and an early sign that there is light at the end of the tunnel. While we still have many months of inventory to absorb we are seeing the early effects of low rates, great prices, and first time buyers taking advantage of the $8000.00 tax credit.

Inflation's effect on your buying decision

Regardless of one's opinion of the recent financial bailouts, the fact is that they are happening, and by all indications will continue to happen. We're simply printing paper! Everyone knows it. And the end result of printing all of this money will be inflation. It is the inevitable result of overprinting money. In inflationary times, cash, bonds, and stocks do poorly. Only two investments thrive: precious metals like gold, and real estate. When inflation hits the Federal Reserve will raise rates to keep it in check. This is their only method of controlling it. The worst case scenario is stagflation, where we have low growth AND high inflation. We had this in the 70's, and stocks performed poorly that decade as a result. However, anyone who bought a home in the 70's can certainly attest to the fact that their property is worth a lot more today. When this inflationary cycle will arrive is a matter of debate, yet it will arrive! Hence, we are sitting on the very best opportunity to buy a home for many years now:

• Rates are at historic lows-when inflation arrives they will be high. By 1981 rates were at 18%
• Sellers are motivated to sell
• When inflation returns, the smart money will move back into real estate. Subsequently, sellers will have more options and will be less inclined to negotiate their asking prices.

In short, RIGHT NOW you can negotiate the best price, with the lowest rates, and hedge against the coming inflation. There is no other investment with all of this going for it. And let's not forget the tax write-offs!

Could I be wrong? Sure! Yet the above mentioned scenario is not only plausible and likely. It also has a historical precedent. Our economy moves in cycles, and it would be fool-hearty to think that inflation will never come back. It is the likely result of printing excess amounts of money.

I short, the case for buying now is simply overwhelming...