Swimming with sharks

"Only when the tide goes out do you discover who's been swimming naked." ~Warren Buffett

“Only when the tide goes out do you discover who’s been swimming naked.” ~Warren Buffett

The real estate season has officially begun!  What does your real estate portfolio look like at the moment? What do you want it to look like? The next wave is surging. Are you still watching from the beach. Or are you ready to ride this wave with me?

Here are a few things I’ve noticed in our local real estate market as of late.

  1. Demand from buyers continues to remain high.
  2. Last year, investors were buying and flipping and beating out nearly every offer with cash, quick closes, and no contingencies.
  3. We still have 1st time buyers aggressively moving into the market with confidence as the investors have begun to reel back.
  4. New construction is back on the rise.
  5. Retail inventory is slowly increasing.
  6. Interests rates are moving.
  7. Everyone ELSE is waiting.

Fortunately for you, I don’t do what everyone ELSE does, which is why the secret to real estate isn’t much of a secret to me. In fact,  it’s easy. Here it is: When everyone ELSE is buying,… SELL. When everyone ELSE is selling,… BUY. That’s all there is to it. Don’t chase the crowd. Let the crowd chase you. 

You know who else knows this formula? Warren Buffet. Buffet, the second-wealthiest person in the country and one of the world’s top investors, has noticed a trend and guess what he’s been buying lately… real estate brokerages.

Just last year, Buffet’s company, Berkshire Hathaway, expanded its Berkshire Hathaway HomeServices California Properties division to over 3,200 agents in over 60 offices across Southern California and the Central Coast. San Diego-based Prudential California Realty became the first brokerage to relaunch under the HomeServices franchise. Since then, nearly 30 brokerages affiliated with the Prudential brand have agreed to transition to Berkshire Hathaway. The franchise now plans to expand across the U.S. and eventually overseas.

What Warren Buffet and some sharp investors (Just last week, my former brokerage, Shorewood Realtors, was purchased by the Denver real estate holding company, Herman Group.)  have had the foresight to recognize is that, by the end of 2014, the real estate “recovery” will be over.

Once the recovery has ended the market will stabilize and people will feel comfortable to start wading into the waters once again.  However, with price stabilization not only does consumer confidence go up, but so do interest rates.

Warren Buffet once said, “Only when the tide goes out do you discover who’s been swimming naked.” And as fun as it is to swim naked, the point Warren is trying to make is that anyone can look good when the water is high and the money is flowing, but only when the water recedes and the money is gone, do you notice who wasn’t quite prepared, and who is suited up and ready for the next shifting tide.

As a former triathlete who had to employ shark strategy while in training and competition, I know that you can’t always out-swim the sharks, but you don’t always have to, as long as you can out-swim the guy next to you. Now that the investor sharks have begun to go away, it’s time to dive into water before the rest of the crowd even realizes the race has begun.

Now, I’ll ask again. What does your real estate portfolio look like at the moment? What do you want it to look like? The next wave is surging.  Are you still watching from the beach? Or are you ready to dive in and get a head start on the competition?

Call me today to set up an appointment, and get you out into the surf. 310-722-5959


About Lawrence Chaves

Lawrence Chaves Keller Williams Beach Cities BRE# 01893036 Member of the South Bay Association of Realtors, California Association of Realtors, and National Association of Realtors. Specializing in residential and income properties in the South Bay and Beach Cities of Los Angeles County. 1st time buyers & new to the South Bay are welcome. Taking appointments now. 1601 Pacific Coast Hwy Ste. 265 Hermosa Beach CA 90254 Phone: 310.722.5959 Email: LJChaves@gmail.com Website: http://lawrencechaves.kwrealty.com/
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