McKae Properties Real Estate Market Commentary

 When Saul of Tarsus set out on his journey to Damascus the whole known world lay in bondage.  There was one state, and it was Rome.  There was one master for it all, and he was Tiberius Caesar. Everywhere there was civil order, for the arm of the Roman law was long.  Everywhere there was stability, in government and in society, for the centurions saw that it was so. But everywhere there was something else, too.  There was oppression for those who were not friends of Tiberius Caesar.  There was the tax gatherer to take the grain from the fields and the flax from the spindle to feed the legions or fill the hungry treasury from which divine Caesar gave largess to the people.  There was the impressor to find recruits for the circuses.  There were executioners to quiet those whom the Emperor proscribed.  What was a man for but to serve Caesar? There was persecution of men who dared think differently, who heard strange voices or read strange manuscripts.  There was enslavement of men whose

It has always been my contention that the end of the year is the best buying opportunities for assets; due to the fact, they are under pressure by year end selling.  Whether it was stocks and bonds, when I was in the Securities Industry, or now in the Real Estate Industry.   Assets; such as, stocks and real estate are not like a pound of coffee with a set price per pound.  They are open to negotiation.  A set price, an offer price, will be given and  a bid below the set offer could be accepted.  Why, emotions, taxes, leverage or just tired of carrying a position. Real Estate has gone through a Down Hill Slide this past year and a half.  I saw the potential some time ago when rates went ridiculously low with over $9 trillion added to money supply.  The speculation that occurred was in asset values; along with, the creation of new investments without any reason of fundamental value; other than, demand.  ECON 101 Supply Demand Curve is always in play.  Lack of supply and demand creates hi

OPENING COMMENTS The end of the year has always been a period of clean up of inventory.  This year is no different.  We are faced with the same issues past markets have been faced with.  Except, the present situation is in reverse.  The increasing rates have supplanted the falling rates.  which in turn has meant rising mortgage rates; rather than, falling rates that in some area of the world dipped to negative rates.  The problems face in the past were economic and health, lower interest rates and increasing money supply helped save the world economy.  Unfortunately, the excesses that occurred led to problems that are in todays economic environment.  Those problems were over speculative tendencies that lead to over priced assets.  Those assets created problems with housing and the lack of affordable housing.  Other assets such as new business have created Poster Children of our time.  You know them well, we may see others join the list as interest rates slowly creep up in the future. S

 Somewhere's in my readings, I came upon the quote,"the problems are the path".  It was  based upon the learning process of humanity; in that, we learn and progress from problem solving.   We do have problems we need to solve.  The problems started with the Pandemic, the shortage of employees and the shortage of homes for sale.  This was then combated with the Federal Reserve System (FED) dropping rates to unheard of low that affected the entire world with some countries going to negative rates.  At the time the Risk Free Rate of Return was down to less than 1%.  That meant that investments of all sorts were fair game.  Next to nothing in money market funds, T-Bills or saving accounts were not with leaving money in them and panic buying occurred in Real Estate, Commodities, Stock Bonds and the esoteric investments; such as, Crypto Currencies.   With the Pandemic over, those laid off went back to work.  All were flush in savings with the $9+ Trillion the FED fed into the e