An economist on CNN may tell you the real estate market is preparing to turn and that is great. What is more convincing is 2,500 aspiring real estate professionals who, in the last few months of 2008, took the real estate licensing exam in New York City alone. I admit to not understanding everything the economists say, but I take notice when 2,500 people stake their career on a market’s future health. What are these 2,500 bright, entrepreneurial, future moguls saying? They are saying that real estate is cyclical. It rises and falls. While no one can forecast how wide or deep the valleys between are, we can say with absolute certainty that peaks follow valleys; and we have seen the mother of all valleys. If history is a credible prognosticator, we are in for the mother of all recoverys. I applaud these New Yorkers for seeing an unprecedented opportunity to get into a market that, I predict, we will be reminiscing about in 30 years as offering a once in a lifetime chance to jump in.
Let’s look at Missouri, a state I know a bit about, as a proxy for the nation, to see how the situation may be even sweeter than anyone could expect.
It was written in a previous post on this blog that Missouri used to have 1 agent for every 100 people in 2006. That number has been cut in half in only three years. Statistics now show 1 agent for every 225 people in 2009. The number of buyers and sellers has grown, the number of structures to sell has grown, and yet, that pie we call “commissions”, is split among 25,000 fewer agents. These numbers are repeated in every market in every state.
I predict a “perfect storm” of economic and demographic conditions for those visionaries, entrepreneurs, mavericks, and future moguls to grab this market by the horns. College students, empty nesters, aspiring investors, ex financial services types – the list goes on. These are the folks who are signaling a bottom as they rotate into real estate to get their piece of the action to come.
I am curious. Are you seeing this in your local market?
