If You Don’t Try Real Estate Housing, You’ll Hate Yourself Later

Tom Bothen is a guest blogger on real estate news for the UIC Liautaud Loop. He is the associate director of the Center for Urban Real Estate at the University of Illinois at Chicago. Bothen is an instructor teaching undergraduate and graduate real estate finance courses, and he is also the director of the Masters of Arts in Real Estate program at UIC. Follow Bothen’s blog this fall for all the latest in real estate industry updates and trends.

After sputtering starts, the data indicate an emerging housing recovery. Cash investors at the entry price points are buying single family foreclosures that are being repositioned as rental properties. This substantially reduces the number of vacant properties and sets the stage for eventual home price increases.

And there are two new condo developments in southwest Florida. This is in a market that had been plagued by oversupply for the past three years. People still want to live in Florida.

During a CNBC interview on February 27, 2012, Warren Buffett said “buy up a couple hundred thousand” single family homes if it were practical to do so.

If held for a long period of time and purchased at low rates, Buffett says houses are even better than stocks.  He advises buyers to take out a 30-year mortgage and refinance if rates go down.

On July 23, 2012, Goldman Sachs issued a “buy recommendation for housing stocks in a report on U.S. homebuilders are an attractive investment as the housing market starts a “strong” recovery that may drive a surge in new-home sales, Goldman Sachs Group Inc. (GS) said in a report today.

Housing has a “long list of positives,” including rising prices, job growth, supportive government policies and a decline in the so-called shadow inventory of homes, Goldman Sachs analysts Joshua Pollard and Anto Savarirajan wrote in a note to clients. They raised their rating on the homebuilding industry to attractive from neutral”.

A survey of 96 real estate finance students during the last eighteen months reveals that ninety-nine per cent of the students still want to own rather than rent a home. And solid financial analysis proves that home ownership is economically superior to renting.

So there is some good news out in economy land and presuming that the world goes on after December 21, 2012, planning to buy a home or trade-up is a good strategy.  For the average American, owning a home is a very good tax sheltered investment for patient growth.

The Masters of Arts in Real Estate program at the University of Illinois at Chicago will prepare you to understand the cross-functional dynamics in residential and commercial real estate as well as the drivers of demand, supply and pricing.