I also find it very interesting that everyone is now talking about chasing condos with multiple offers on them in C neighborhoods when they were treated like “lepers” in 2009-2011 on this forum. Really classic crowd following behavior on Pigg:
-2006 everyone should have been RE bears
-2009 just when everyone should have been backing up the truck on rentals, everyone jumped on the “bearish” bandwagon. It was all the rage to be the gloomiest, end of the world type. Just at the very time it was time to get greedy with real estate. Now in 2013 since it seems safe, everyone jumps in chases properties with 40 other offers when in 2009 we had way more inventory, tons of foreclosures, sometimes sitting with no offers at all for weeks or months.
-2009 when the DOW was at 7,000 everyone was panicking that it could go to 3,000, selling off their mutual funds. Now the DOW is 14,000
Very classic to me that just like people jump on bullish bandwagons in booms, people jump on the “bearish” bandwagon in busts, just at the VERY time when they should have been bullish, the peak of crowd following bearishness exists. Very classic. It will happen again and again and again. b/c most humans are psychologically crowd followers by nature. And those “bears” think they are being so smart and contrarian at those very times they should have turned bullish again. That is why there is a very, very, very small percentage of rich people like Buffet & Sam Zell who make a lot of money investing. As Warren Buffet says, “be greedy when others are fearful, fearful when others are greedy”.
Not saying I got it all right at all. I was a little too conservative in 2009 and bought into some of the “end of the world” economic stuff. Wish I was more aggressive with rentals. But I’m glad I did pick up some stuff and also held on to my mutual funds in 2009 when everyone was selling in a panic when the Dow dumped.
That’s not saying things couldn’t crash again. I do think the Fed printing $$$ massively, keeping rates way lower than they ever have been in U.S. history, & the way the Gov forced banks to not foreclose on people is responsible for much of bounce we have. We need to see incomes rise, more good jobs, lower unemployment before I get very comfortable.
