How to make $30,000 in a Down Market!

When the real estate market slowed, many people turned to the stock market thinking it was a safer place to be. That is not proving true. In the Portland area, housing values have dropped 10% - 15% over the past couple of years. Lately, some 401K’s have lost 5% in one day!
So, the perfect storm has been brewing for months. For two years the real estate market has contracted. Home values have become much more affordable. Now, the credit industry is loosening, courtesy in part to our $700 billion rescue plan. It is the perfect setup to unleash pent-up demand.
History shows that most of the world's largest fortunes have been created when everyone else was filled with fear. In fact, the two greatest fortunes in American history were created during times almost exactly like these. It was just after the stock market panic of 1873.I t started with a housing bubble, similar in cause and effect to the current one. The turning point was the failure of Philadelphia blue-chip bank Jay Cooke, similar to our Bear Stearns sale for $2 a share. Once the bank fell, the credit market locked up and nobody was lending money. Companies failed by the thousands. The economy was horrible, yet some businesses flourished.Companies that positioned themselves strategically and exploited the opportunities reaped huge rewards. John D. Rockefeller, who founded Standard Oil (the parent of nearly all the major U.S. oil companies), was able to buy out his competition at fire-sale prices. Andrew Carnegie, who built U.S. Steel and became history's second-richest man behind Rockefeller, did the same thing. These men converted their companies into empires. The years following the Panic of 1873 became the Gilded Age of Industry. I love the way Warren Buffet puts it. He says, "Be fearful when other people are greedy...and greedy when others are fearful." Like he says, now is your time to BE GREEDY!
Which bring me to how to make your $30,000. Do you know that it is very wise to buy up to a more expensive home in a down market? Yes, you may loose 15% on the $200,000 house you are selling ($30,000), but you may well pick up the same 15% on the $400,000 house you are buying ($60,000). (I can write your offer today!)
You see, it really is a good market. Values may be set back a couple of years, but it is still better than it was in the late 90’s and early 2000. If you don't plan to flip a house, but live in it for 5 years or so, this is the time to do it. It is a time of opportunity!