An Unprejudiced View of the Real Estate Market... Kind Of

Ok so I’m not a realtor or an expert on mortgages. But taking a common sense approach to analyzing the market, free from prejudices and more importantly without an immediate vested interest in an improved market, has its advantages.

I first became seriously interested in the market and wary of it during a trip to New England nearly 10 years ago. I was encouraged by many to spend big on real estate. These advisors were heavily mortgaged but making a killing off of property they claimed “always went up”. One bragged his property values had more than doubled in ten years. 

Fortunately for me, I didn’t take the plunge and mortgage my home for a second or third one. I reasoned that salaries hadn’t doubled, nor had rents and something was going to have to give. Noting bricklayers in New Orleans buying $400,000 houses only reinforced this notion. In 2006, Sir Newton won the day.

So, post real estate crash, I’d like to take the same approach to analyzing the current “recovering” real estate market. Experts in the field, mostly realtors seeking customers and homeowners swimming in debt, point to prices increasing across the nation and shortages of homes in some areas. Detractors look to a coming surge in foreclosed properties hitting the market. Who’s right?

The situation I see is this. Thanks to decades of low interest rates and government backed loans for qualified and let’s face it less than qualified folks, the percentage of people who can afford houses actually owning one in the US has been growing for decades. Great news, yes? Great news No. Traditionally, a large percentage of home turnover is from folks trading up. There’s also second home buying using equity. And then there’s mom and dad helping finance the kids first home. The perceived recovery can’t rely on this in the current environment. Too many people lack equity. This is a huge negative. And yes there is a huge inventory of foreclosed homes coming to the market soon. On top of that, banks are making it a lot harder for anyone to qualify. True this would have been a good idea 20 years ago. But it doesn’t help us out at the moment. Want more bad news? The economy still sucks. 

Depressed? Ok, so some good news. The market may be stable for now. And prices are more in line with salaries and rents. So a purchase might be in order, if you can afford it. But don’t expect to make a killing off of it anytime soon. Maybe the grand kids will cash in and think what geniuses the old grandparents were. But if you’re looking to make a quick buck off the current market, good luck. I especially like rental property. Prices are even lower for larger complexes and rents aren’t likely to go down. If you can turn a profit early or immediately, go for it. Property values won't be an issue. 

So that's my sort of kind of unprejudiced view of the real estate market. I admit some prejudice I see myself buying some of those low priced rentals in the near future. 

Like some feedback. Please comment.

Business Intelligence, A No Brainer.

Technology Commercialization specialist is a professional best adapted to working with new products, product realignment and my favorite, startups. The profession and degree was created in response to recognition that many C-level executives failed to understand the entire product to market process and all the complex sub processes required to successfully travel the long tedious road. The fact that technology products now have life cycles of less than 18 months made a keen understanding of this all the more critical.

A recent conversation with a research business strategist at Research Edge provided me with example and desire to write this. As a Technology Commercialization expert, I was more than aware of the need for a detailed market and location analysis. But in todays very rapidly changing world, new tools are appearing daily. So fast, in fact, that many academic institutions aren’t able to keep up.  Research Edge was way ahead of me in this field and, as a technology commercialization expert, I’m putting them on top of my marketing go to list. Very impressed!

Building a great company or product is a complex business, more so today than at any time in the past. It takes experts in so many fields to align, produce, package and deliver any product or service that a solo operation is laughable. You don't go to war alone and you definitely don't want to go in blind. You need all the intelligence you get your hands on long before committing the entire operation. I mean honestly,  the commanders of Operation Endring Freedom didn't forego the satellite imagery as too expensive before sending in the troops. The risks were too high. 


The same goes for your business. And the first place to start is an alignment specialist that knows who is needed and when. 

So, adding to my dream team would be Zande+Newman for branding and Research Edge for all information gathering needs from market to location and more. The commanders of Operation Enduring Freedom ate still not available. More specialists to come.


Here's a great related video from Youtube:

Adaptive versus Pre-Adaptive Businesses

When a change occurs in the natural environment or a new species is introduced, existing species don;t have tome to adapt. It’s only the pre-adapted that survive. An individual must already possess the traits required to compete and survive.

Unlike most other species, humans have the ability to adapt. If the weather turns cold, we can’t just grow fur. There’s not enough time. But we can kill a furry beast and wear its skin. We possess this adaptability trait due to a very significant pre-adaptation, the ability to reason and to envision the future. It’s what sets apart from the beasts. 

It’s the same in business. With technology products having life cycles as short as 18 months, there’s no time to adapt to any new entrant or change in the environment. No time to develop adaptation systems. A business must be pre-adapted with the ability to turn on a dime and respond instantly to changes that couldn’t possibly be foreseen. 

In other words, an adaptable business is prepared to respond to changes as they occur. A pre-adapted business not only has this response capability built into its business model, but it also has the ability to anticipate changes that haven’t occurred and implement them itself before the competition. That is, the business must have already adapted before the change in environment occurs or before a new entrant arrives. 

The Neanderthal was adaptive, but didn’t see us coming armed with pre-adapted traits that poor old Alley Oop couldn’t respond to quickly enough. 

Lesson here is to build a business that can scan the environment now and envision what might come. This takes a great deal research, lots of academic connections and a decent R&D budget.

New Orleans Leading in Educational Reform

Unique View on Blue Ocean Strategy

Found this very interesting youtube post about Blue Ocean Strategy through Pinterest. It makes a case for innovating within an existing market as being move profitable than the very risky Blue Ocean strategy. Worth a look.