San Antonio's Rockstar Turned Realtor®: When the dam breaks - Buyers waiting for the bottom.

photo courtesy of Tom in NYC

Ready, willing, and able.  So why is there no rush?

We've all heard the theory and idea that there is a lot of pent-up buying potential floating around right now.  People want to buy, but just aren't committing to it as easily as they once did.  Buyers are more cautious; thinking out every possible scenario of their purchase and doing their homework before getting in your car.  They're ready, willing, and able; but they just won't pull the trigger.  Yet.

The lake waters are filling in behind the dam walls and the waters are rising.  I see it every day in the amount of prospects coming through phone duty, email, and products like Growth Leader.  I'm following and chatting with a lot of potential buyers right now.  A lot of the prospects I talk to are "just looking."  I think there's more to it than that...a new category - "just looking until I feel comfortable that I'm not going to wind up buying a house today, that I could buy for less tomorrow."  This new category of buyer is everywhere and they want a home, they can afford a home, but they've built up behind the dam walls taking a wait and see attitude.  Anyone who's take a elementary physics class knows what happens when energy builds to a breaking point.  Anyone who remembers Hurricane Katrina could tell you as well...even if you weren't there to see it.  The levees were pushed to their limits.  And when the energy exceeded the holding capabilities of the levees, New Orleans was under water in no time at all.  While our buyer-energy buildup will not have disastrous effects like Katrina did, we still will experience the rush of the incoming waters.

Time the market or time your own perception?

Timing the market is an age old tradition that people love to try and do.  Unfortunately, usually by the time the signals are there that we're on an upswing, its too late; you've missed the boat.  Gary Keller tells a story of how he gets clients to understand it.  He takes a blank piece of paper and says he's going to represent the market going down by drawing a line on the paper.  He asks his clients to try and predict the bottom of the market (at which point he reverses the pens direction and begins taking the "market" upward) and tell him when they think its bottomed out.  As his pen moves across the paper he watches his clients to see their thoughts as they try and predict when he might move his pen in the opposite direction.  He says that they never hit it just right.  They either hit it before the market hits bottom or after its already moving into its upswing.  Its about as easy as trying to catch flies with chopsticks.

San Antonio's future - not a vision, but my thoughts (and hopes).

Here in San Antonio, we're not far from putting a few cracks in the dam and making the pent up energy all the more powerful.  I think we will experience the trickle of water spilling through the cracks as the dam weakens to a point where it finally bursts.  When it does, the ensuing rush to buy will inundate us with new clients and a short term appreciation gain.  I think we will have a mini-gold rush on our hands as investors and home buyers alike will push to buy, decreasing our current inventory levels in the short term and pushing prices upwards.  San Antonio is know for its slow growth in housing markets, but within a few short months, I think we will experience some gains in value, but will level off quickly (it won't be like California's appreciation gains over the past few years).  As our winter months are almost behind us, I expect to see much more activity in the coming months and feel that by mid-summer we should start seeing the effects (barring any unforeseen changes in our local economy).  Will I hit the mark and be correct?  Only time will tell.