I have been sifting through comments on real estate articles in an area newspaper. There was one that really stood out to me. I have already written a post about this called, “Waiting yourself out of a new home.”
In this newspaper comments, one person commented, “I’m sitting on the sidelines. I was going to buy a home over a year ago. Instead we’re living in a basement apartment and waiting. I told the realtors and home builders 14 months ago that I wanted to buy, but not at the huge mark ups that occured in just one year. A $135,000 condo was selling for over $185,000.00 in less than a six month period. Outrageous. I’m sitting on my cash, waiting for the market to correct “BIG TIME’ ”
If he had bought that condo at $135,000 he would be owning a home right now with $50,000 equity instead of living in a basement apartment throwing rent out the window. In just 6 months time, his investment would have grown $50,000!!! He is sitting on his cash??? People who successfully acquire wealth never “sit” on their cash. They invest it, they leverage it, they put their money to work for them.
The idea that the market is going to “correct” itself is also a funny one. There is speculation from others in this same thread as well as this commentor that prices are going to correct themselves. I think they mean that prices are going to come down??? If you look back on history, there has never been a large decline in real estate prices. Once they appreciate, they pretty much stay appreciated. The thought that you can put your money under your mattress until that condo gets back down to $135,000 once it was $185,000 is hilarious.