Bubble Schmubble

bubble-6

OK, I’m officially over it. I’m sick to death of hearing about “The Bubble” and how it’s certain to burst. For those of you harping on this out there…GET OVER IT! What we’re experiencing here ain’t no freakin bubble. There’s a more accurate term for our market…normal. Adapt to it, roll with it…come to terms with it’s truth! If you were to look at a graph of the last 30 years of home appreciation around here you would see something that looks alot like a drawing of one side of Mt Everest. Almost  all of it steeply uphill with a few plateau’s here and there and a BIT of a dip around 2008-09. Those things were the bubbles folks…the rest of the years constitute normalcy. I don’t see how everyone seems to collectively think this is all going to come to a screeching halt all of a sudden and prices will dip back down to 1998 levels.

Speaking of 1998 levels…how about we compare 1998 levels to now and see what kind of investment real estate has been for those who managed to get off of their butts and launched into the great unknown. One of the things I love about Foster City real estate is how easy it is to compare properties. Cuz they’re cookie cutter homes.

 

Project                                                  1998 high                              Current high                              % appreciation

 

Sand Harbor Condos                        $230,000                              $730,000                                     220%

Bayfront Court 1530sq ft 3br          $387,000                               $1,415,000                                   262%

Shell Cove 1700 sq ft 4 br                $397,000                                $1,351,000                                  241%

HarborSide 1350 sq ft 3br water   $489,000                                 $1,310,000                                  168%

1860 sq ft 3&2 house                       $515,000                                  $1,400,000                                172%

Williams Lnd 1670 sq ft 3br           $431,000                                  $1,350,000                                200%

2180 sq ft 4&3 house on water       $650,000                                $1,700,000                               160%

Whalers 2240 sq ft 4&2.5 water    $920,000                                 $2,400,000                              160%

 

You name the project…you’ll be looking at pretty much the same kind of appreciation. Last week I sold a fixer to some nice folks in San Carlos for $1,300,000. They were motivated since they just got a $600 a month rent increase. They told me they have many friends who just have simply opted out of buying a house because they’re worried about the bubble. Instead they feel that renting combined by intelligent investing in the stock market will serve them just as well. I couldn’t resist…I checked to see the average stock market return since 1998. It was 28.6%.

Call me zany…but I’m thinking 200% appreciation is a tad better than 28.6%…and I don’t have to compulsively check the Dow or Nasdaq every half hour to see how I’m doing. You just sleep and eat…and live and that’s what happened. Weird, huh?

So, if you’re perched there atop the fence and you’re contemplating that bursting bubble saving you I just have one question….how much money are you willing to lose before you grasp that there really isn’t a bubble? Even if the market slows, which it will, it’s still not what you’re imagining it as.

Speak Your Mind

*