Market Observations: Flex & Thrive In This Market
G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time
What Happened? From October 2007 - October 2009 Huge Economic Slide Real Estate lost 50% of Value* Unemployment Doubled Foreclosures Tripled Politicians Scrambled, Trying to learn lessons from FDR’s New Deal The Graph looked Something like this:
* some areas more, some less
G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time
It Finally Leveled Out 20-20 Hindsight shows us that October - December of 2009 was the bottom. The questions became: Where to from here? How fast will the market recover?
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Where From Here?
G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time
It’s Unanimous! Everyone Voted: The President would like a rapid recovery.
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The Investors would like a rapid recovery Buyers & Sellers would like a rapid recovery The Banks would like a rapid recovery
Where From Here?
G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time
Like This Would Be Just Fine So Everyone set off to make it so. Congress threw in $8000 of stimulants. The President cheered Buyers offered over full price
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No More Bargain Basement Selling If we all act like it’s true It will be true ... Wont it? G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time
Then Reality Set In Instead of a VEE With a steep Down and an Equally steep Back Up.
Reality is more like a Teacher’s Check Mark Dont you just hate it when Reality doesn’t cooperate Saving The Planet with what we’ve decided? One House G r e e n E a r t h E q u i t i e s . C o m
© 2010
At A Time
Correction To Reality Some prices went back up too fast Buyers and Sellers and Banks and Investors Acted like the recovery was well under way and vigorous. So now we have what looks like a double dip But we’re just recovering from being over stimulated with TheSaving Planet House Optimism and Tax Credits One At A Time
G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Learn From History? To the extent that this time is like Recovery from the Great Depression (and the comparison is far from perfect) we might observe and get some help in our guesses about the future. Q. By 1937, (8 years into the New Deal) how far were we in our Economic Recovery? A. Some progress but not very much. There was talk of the double dip and FDR’s financial architect wrote in 1937, “We have failed” G r e e n E a r t h E q u i t i e s . C o m
© 2010
Saving The Planet One House At A Time
Learn From History? Q. When did GNP (non-military) return to 1928 levels? A. 1953 This is not then ... But regardless of our desire for a quick fix, the reality is more like a long slow climb with some small hills & valleys Maybe like this....... (Prognosticating Is A Fools Game) G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time
Bottom Line: Stay Flexible Have Multiple Strategies GreenEarthEquities made money in this time These bumps can require you to change strategies
We can surely do even better Saving The Planet One House in this slow recovery G r e e n E a r t h E q u i t i e s . C o m
Š 2010
At A Time
Multiple Strategies & Readiness To Change 1. Retail Flip Basic sale to first time FHA qualified buyer 2. Lease Option: Opens up the pool of good people with poor credit. 3. Refinance & Rent: Allows Investor to recoup cash and continue, buy the next project & stay in the game. G r e e n E a r t h E q u i t i e s . C o m
Š 2010
Saving The Planet One House At A Time