I am confused as hell, but then again maybe I’m not.
“An economist is an expert who will know tomorrow why the things he predicted today didn’t happen tomorrow.” – Laurence J. Peter
As recently as these past few weeks in the National Post and the Globe and Mail, we read that the “bubble in real estate markets will either level off or prices will move down by five to 10 per cent, and in some areas of Canada, as much as 20 per cent.
“We know that the market was due for a correction. Most properties are overvalued,” one economist shouts in the Globe and Mail.
That may be so, but should we bail out of the profession now? We know that the market had to level off eventually, but does that mean that we should start cashing in our RRSPs? Should we cancel our trip to Vegas? Maybe we should sell our SUV and buy a Smart Car?
In my opinion, we should do none of the above.
Over my 40 years (yikes!) in the business, I’ve seen all kinds of peaks and valleys. One thing remains constant – the need for both renters and move-up buyers to invest in real estate because it is the safest haven for their hard-earned money.
Sure, the market was/is due for a correction on the resale end. But not in new homes or new condos. Builders have too large an investment in land and the interest in carrying that investment. New home prices will continue to escalate due to the HST in Ontario and B.C. and buyers will still continue to invest in new product as well as resale homes/condos.
Will the HST affect us? Sure, but only in the short run of things as some of us experienced when the GST came in.
Canada is seeing a growing economy. So, what’s the conundrum? The economy is good, the dollar is strong and employment is running smoothly.
What are successful salespeople doing when they hear all these voices of experts and economists? They are:
1. Getting back to basics, contacting their database, often now through networking vehicles such as Twitter, YouTube or Facebook.
2. Sending out a personal note of thanks to their client base with a little gift card, perhaps from Tim’s, for a large double double.
3. Networking with other businesspeople at luncheons (see your local papers for dates and times). A progressive agent would do this as he would be the only agent at a table of five to eight businesspeople. Referrals are always great, aren’t they?
4. Publishing articles in local papers, personal websites or on Facebook.
5. Running yard sales for the neighbourhood and hosting a picnic or barbecue.
6. Attending future-thinking seminars such as Richard Robbins’ Master’s Edge or Dan Plowman’s Team Building to further enhance their knowledge.
7. Last but not least, they will get closer to their broker or broker/manager, who in all likelihood has been through most peaks and valleys and may just have a few bits of advice to share with them.
I can remember times when prices did go down during recessionary periods. But overall, the homeowners of today and the buyers of tomorrow will benefit in the long run by owning their own home. History has proven that. The Toronto Star’s great bar graph in early May of this year showed quite dramatically that over the past several decades, single-family home ownership was better than owning most stocks or bonds over the same period of time.
A great philosopher said: “Own a piece of the earth, they’re not making it any more!”
Talk to people every day about the benefits of owning their own home. Their equity may shrink from time to time, but with careful budgeting they’ll win in the long run.
You can catch some of my meanderings on my blog on Active Rain. It’s a great site tailored for Realtors in Canada and the U.S. You may be surprised by referrals you receive with a very little investment of about $340 (US) annually.
Stan Albert, broker/manager, ABR, ASA at Re/Max Premier in Vaughan, Ont. can be reached for consultation at stanalb@rogers.com. Stan is now celebrating 40 years as an active real estate professional.
Stan Albert, ABR, ASA is a consultant with Re/Max Premier in Vaughan, Ont. He can be reached for consultation by email. Stan is now celebrating his 45th year as an active real estate professional.
