An otherwise good article in the January 8th Wall Street Journal was headed “Speculators Helped Fuel Florida’s Housing Boom.” There were still a few dozen people out there who didn’t know that. Unfortunately they still don’t know because they don’t read the WSJ. “Many factors contributed to the boom—low interest rates, a strong economy, creative financing alternatives, a swelling boomer population with lots of wealth transferred from aging parents, and the media itself. But the presence of speculators best defined the boom.” says Toby Tobin, Publisher of GoToby.com, LLC, a real estate news website for Palm Coast, Flagler County, FL.

Speculators are otherwise rational people who somehow morph into someone who will buy a property for $100,000 more than the seller paid a few months ago on the assumption that the person in line behind them will do the same. Speculators must dress, walk, or smell differently because they always seem to find each other at cocktail parties. Here, fortified with media hype, they brag and feed each other anecdotal evidence of their shared theory of a perpetually rising market. Once bulked up and re-energized, they’re off to proselytize to others.

Currently, the market is in a correction period. Yesterday’s speculative buyers are today’s sellers. The discretionary buyer is on the sidelines. The media trumpets the bursting bubble. Ironically, interest rates are still low, the economy is still strong, and the transfer of wealth to Boomers from their parents continues. What’s missing? The media hype has become media gloom. And the speculator/buyer is gone. But we already knew that before reading the WSJ article.

Real estate agent Caesar Parisi stands ready with effective advice on buying or selling a Boca Raton FL condo. Visiting the Delray Beach community? Contact Realtor® Caesar Parisi for information on buying or selling an Atlantic Grove Condo in Delray Beach Real Estate.

click here for article

search for :