After a plunge lasting three years, houses have finally become cheap enough to lure buyers.
Orlando, Fla. (PRWEB) September 4, 2009
Robert Allen announced today that in his best estimation we will hit a bottom to the real estate downturn this coming October and that now is a good time to buy. This comes on the heels of noted financial expert Jim Cramer's prediction that June 2009 would bring a bottom to the market.
"What's changed from a few months ago is that inventory has begun shrinking, bidding wars have started across the country, and prices are finally starting to rise in many markets. I'm encouraging all my clients to start looking for properties again," said Allen.
"Smart real estate investors who buy carefully during these years will not see better bargains for many, many years to come. For many, this will be the best buying opportunity of their lifetime. About every ten years, the circumstances converge to create amazing bargains. We will look back on these years with fondness, like we look back at 1974-1975, 1981-1982, 1989-1990 and 2001-2002… as times when the deals were plentiful and fortunes were made."
Robert Allen isn't the only one calling the bottom of the real estate market. It seems many mainstream media outlets share Allen's sentiment. According to a New York Times report on July 28, "After a plunge lasting three years, houses have finally become cheap enough to lure buyers."
The Washington Post's outlook was even brighter on July 30, "The battered housing market appears to be on the mend, with sales climbing nationally and prices leveling off, even rising in some spots."
Some publications have gone as far as to call an end to the economic recession. On August 11, The Wall Street Journal posted that the majority of the economists they have surveyed during the past few days said the recession that began in December 2007 is now over. Robert Shiller of Yale University and co-creator of the Case-Shiller index recently said, "The change in momentum here is very significant." According to Dean Baker, economist for the Center for Economic and Policy Research, "The freefall is over."
Recent facts seem to support Robert Allen's and the media's claim that not only is the recession over but the real estate market has hit a bottom with some areas of the country even posting average price increases. According to the Winans International Real Estate Index (WIREI), which measures U.S. home prices from 1830 to present, all regions of the U.S. have seen significant increases in new home sales, which has led to a decline in new housing inventory. Historically, an increase in new home sales and a decrease in housing inventory have been clear signs of a turnaround in past downturns.
But the fact remains that new and returning investors may still be leery of stepping back into an emerging real estate market. When asked about hesitant investors, Robert Allen said now is not a time to be sitting on the sidelines.
"The investors who see the most success are the ones who buy when everyone is selling and sell when everyone is buying. It's a fundamental law in real estate and that's what's starting to happen right now. Prices are at historic lows, so bold investors are getting back in the market. We've even retooled our whole thinking when it comes to the strategies we teach our students. The focus is now on investing in a bottomed-out market. I can tell you, there will be a lot of healthy real estate portfolios being created in the next three years."
About Robert Allen
Best-seller, Nothing Down, established Robert Allen as one of the most influential investment advisors of all time. Robert Allen has followed that success with three other best-selling books including Multiple Streams of Income and the soon-to-be released, Cash in a Flash. Robert Allen's new Investing in a Bottomed-out Market real estate education tour begins in San Francisco on Labor Day.