Return on Investment on Real Estate over Time

So what is the return on investment of real estate compared to other investments like the Dow, the S&P, and the NASDAQ. Now after the fiscal cliff has been averted, we are going to probably see some jump up in the Dow, S&P, and the NASDAQ.  But we can still see - if we go all the way back to January 2000 and compare it to January 2013 - thirteen years later, we can see that the investment in real estate, in this country - through these crazy time - was better than investing in any of the stock markets.

The Rate of Return for Major Stock Markets January 2000 to 2013

Annual Appreciation of Homes January 2000 to 2013

Know that over time in this country,  real estate has always been a great investment.  Maybe not short term - from 2006 to 2012, but over the long term real estate has always been a great investment.  Any we are starting to see prices picking up.

Demand is up and supply of homes is down

The one thing that I think that could be standing in our way—and this is going to sound funny to some 

of you—is the biggest challenge in most parts of the country is inventory. This chart  shows you the month’s inventory of homes for sale from the NAR existing homesales report. A normal market 

is that yellow line going across. That is five to six months. 

The reason we have had challenges over the last two years as you can see that the inventory was well 

above normal levels. That said that we are in a buyer’s market. There is too much inventory for sale 

compared to the amount of demand there was for that inventory. 

And pricing is all about supply and demand. Supply was way up and demand wasn’t.

 

Well demand is starting to increase. Just take a look at this slide.  And at the same time, inventory is decreasing below normal levels in many parts of the country.  As a nation overall, what does that mean?  Well if demand is up and suppl is down, prices are going to go up and that is exactly what has taken place.  We will address that issue going forward.

I would appreciate any comments on this post.

Placitas NM Banks, Grocery Stores, and Restaurants

Placitas NM Banks, Grocery Stores, and Restaurants. Placitas NM is a community approximately 10 miles north of Albuquerque NM, so if you are looking for the Banks, Grocery Stores, and Restaurants serving this community of primarily custom homes, the map below will help you.

View Placitas NM Banks, Grocery Stores, and Restaurants in a larger map.

Placitas NM is a wonderful, friendly village of approximately perhaps 500 homes, located 10 miles north of Albuquerque, and when I first settled in this area, there were few services.  We had one restaurant, one grocery store, no coffee shops, one local bank, and no drugstore.  But in the last nine years Placitas NM has added Banks, Grocery Stores and Restaurants, a Starbucks, and drugstore, and the surrounding area has expanded the services available to the local residents.

Placitas is about wide open spaces and beautiful views of the Sandia Mountains and the Western Mesas.  I have to say, that I never get tired of these views because they are always changing.
There are various types of homes available in Placitas, from the new one story custom houses with tile floors, granite counter tops, wood ceiling, vigas, and tons of outdoor living space.

To two story homes that are partial ADOBE with grassy courtyards.  Adobe construction is unique today, but was a standard long ago when dirt, water, and straw where the building blocks of construction.  Adobe walls are at least 14 inches thick, and are a great means of absorbing and holding the solar gain, which the walls will release in the cool of the evenings.

If you would like to discuss the Placitas NM Banks, Grocery Stores, and Restaurants, and the other services available to Placitas residents, please give me a call at 505-350-0911 or check my website.  Carol Skees
Placitas NM Banks, Grocery Stores, and Restaurants

Comparison of Pending Sales 2012 to 2011

I want you to see how the last twelve months, the immediate twelve months prior to December, how it looked compared to the twelve previous months to that. So we can look down at the bottom—November 2010 to November 2011 is the light green on this graph. The dark green is November 2011 to November 2012. We can see that 2012 totally destroyed 2011 as far as sales are concerned. And I think we are going to see another big jump up again in 2013.

Now again, are we going to see 2006 levels? No, not any time soon. But 2006 was a little bit of an anomaly. What we are is back to normal levels.

NAR, who puts the pending home sales report out, and has tracked these numbers prior to the bubble what is the historical healthy level of the real estate market. They put that at a hundred. That is the gold line going across the graph. We could see we are super. We have been bouncing off the level over the last couple of months. Now we have definitely jumped above that in a big way. We think we are going to continue to see very strong pending home sales through the next couple of months, which will be a little bit of an anomaly, because that doesn't normally take place during the winter months. But I think we are going to remain strong this particular year.

I would appreciate any comments about this blog, or any other blogs.

Homes sales are going up!

Pending Homes Sales November 2011 to November 2012

Pending home sales continue to go up over last month and over the last year.  Looking back twelve months now and we can see that there is a tidal wave of people coming into the real estate home ownership field.  They have decided that this is what they are going to do now.  It is now time because of home affordability, interest rates being where they are, prices being where they are, and people starting to project increases in both, they are jumping in and saying, "You know what? Now is the time for me to be a homeowner." Checkout the chart of pending sales.

Let me know if you want to know what you happening in your area.  By the way, comments on this post are greatly appreciated.