The best real estate prices are in a depressed market. As people are frantic with media and frozen with economy the time comes to gain from the short sighted individual. The person that is ready will be unscathed by the invisible claws of social economics. Real estate sees its true value when the initial buyer defaults in his mortgage. The buyer defaults the bank take control and the downed market coerces the bank to show humility and accept, to the benefit to the forewarned buyer, a lofty discount to his new home purchase.
“Where do I go from here?” Says Alice. “Well that depends on where you want to get to.” Replies the cat. – Alice and Wonderland.
A down market crushes the unready. His mortgage default because of ill saving. Blind of direction. Reduction of hours or termination of employment occurs spontaneously. The hypochondriacs show themselves in a sheep like fashion they find him to consult. The rabbit hole drives deeper for the unfortunate soul when the government gives money controlling him further. This cages the dependent man as he falls apart financially and emotionally. Inevitably giving way to his foreclosure and bank takes back control of the house that was never truly his.
The banks act as strings of a puppet greedily pulling as much as they can when they can. The banks are the market movers and tricksters. When the bank has its final pull it clutches what is officially theirs then passes it off to the next person. The next person is often not a person at all but a collection of people who all follow in the sheeplike heard ready for slaughter. The bank indiscriminately pulls what is able without ever considering why or if timing is correct. In Edward Chancellors book The Devil Take the Hindmost, Edward goes back to the 1600s to illustrate the irrational and slow thinking of how the banks operate. This goes to abyss when the bank get sacked on being too greedy and suffers from other sins of jealousy and envy. As the bank pulls what it can from the unprepared the bank sets a darkness around the economy that only the astute investor is prepared and like a hunter he waits for the best shot.
As the economy mopes and ideally stands by the buyer starts to actively search for new modes of profit. The buyer reaches a point of genius when the conviction from his thoughts drive the population to do business with him. From a book (i don’t remember which one), recognizes it’s best to be the third buyer of your house where the first is the initial buyer the second is the bank and the third is the buyer looking for the deal. In a prime market, buyers are looking for a similar deal and some need to be abandoned as the price becomes too close or slightly above the market value. However, once the depression strikes the time calls to where there are many more houses to buy with less buyer to drive up the price. This is where the long-sighted buyer truly finds his dream home. A value the could be consulted to a propitious future or a sweet deal for the hustler on the side.
The initial buyer defaults the bank takes back their home and a version of a hero appears. This pattern isn’t new. It has been done repeatedly. The pattern will most likely happen again. Will people be ready? Or lazy in their fortune? People suffer and others prosper. For any prosperity someone else falters. This is the pattern of history. Like Edward Chancellors book on financial speculation, may devil take the hindmost.