I’m not claiming to be Nostrdammus with his legendary forecasting capabilities in the 1500s. But the data doesn’t lie and I saw it with my own eyes. Let’s geek out on this.
Dropping Prices
Let’s start with the end-in-mind as author Stephen Covey said in his book “The Seven Habits of Highly Effective People.” So the end of the story is about the housing market: buy, sell or short.
In my neighborhood, on my morning walk, over the past 510 days (that's almost 17-months), the price of homes in the example (I live in the Texas Hill Country just west of Austin) for these units has dropped from $700,000 to $400,000. That’s a 55% decline. Other friends have shared similar stories (my friend Janet in Florida has shared a similar story).
Before (June 2023)
After: November 2024
What the key inflation measures are missing?
The Consumer Price Index is kinda the “go to when measuring inflation. The shelter )include housing)component is weighted at 36.54% and is the largest component (for example, food is only 13.46%) You can double-click and double geek on this at Nerd Wallet for more dets ()
I realize my example is localized to a specific geography and real estate is local, local, local (that be micro-economics). What the hell is going on here? How can the price of eggs (increasing again due to avian flu (blame your political opponents for that LOL) get all the media attention? Recent reports have shown inflation peaking in the double-digits at the height of the pandemic (with toooooo many dollars chasing tooooo few goods) down to under 3% in the latest reports (so now you congratulate your favorite politicians who love to take goodness credit and overlook global market forces (macro-economics) at play LOL).
Warning: Geek Speak Ahead!
As many of you know, historically my core audience is Managed Services Providers (GEEKS!) and I love feedback from them or anyone ;) What’s happening with your effective billing rates also known as Monthly Recurring Revenue (MRR)? Are your rates going up, down or are they all around? Are you factoring in a possible new wave of inflation of tariffs impacted global trade (is so - buy that computer technology (including hardware NOW!). Do you even care (LOL)?
So in the spirit of Covey, I end where I started. With improved real property, is it time SELL, BUY or SHORT? By shorting I mean doing a short sale against Wall Street housing villains?
I’m not done with this story yet so keep it right here! Feedback is always welcome. You’ll find me on LinkedIn (here is my LinkedIn profile ) where you can send me a note.
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