Out of fear, many people repeat the following phrases endlessly:
“this economy sucks!”, “our economic woes…”, “with this economy…”, “in these uncertain times…”
The temporary housing market is far from devastated despite widespread news coverage to the contrary. News sources today are projections of fear that have stifled many markets they “report” to. Yes, there are many markets that were hit hard and a lot of people directly related to those markets suffered. The real estate and stock market were primarily affected and to be quite blunt, gamblers lost their money. The banking institute teaches that our houses are untapped bank accounts that we can raid anytime we want. During bull markets, the stock market evokes images that money rains from the sky and that inexperienced stock holders will do just fine because every stock eventually goes up no matter what or that someone else is going to make you a lot of money.
We as an established business pre-economic downturn, made a few cut backs but were largely focused on how to react to the ebbs and flows of the people who might become our tenants. We tried to adjust to “the new market” but there wasn’t anything “new” to do or offer. We sweetened our offerings anyway but it did not make a bit of difference and our company and large corporations like Oakwood and Bridgestreet got hit hard. We are all growing again and the housing business is back after the long pause and it did hurt. I still believe we all hurt for the wrong reasons when people second guessed everything they did because of sensationalism. We observed all of this first hand. We watched other people’s fears affect our own and we feared for ourselves.
So what happened? People that borrowed against their house lost their houses. And people who borrowed from the gambling ‘house’ lost to the house. Remember that saying “the house always wins”? Well that house now owns your house, literally. Unemployed and largely unskilled laborers are fighting for jobs with migrant workers because it’s not that easy to get a job anymore. The college educated with nonviable degrees or declining fields of study and the poorly motivated college graduates are moving back home with their parents.
Many may not realize that a lot of these fields our young studied and prepared for were on the decline anyway. The publishing business, newspapers and print journalism are all being taken over by internet sources and computer programming/software engineering jobs have long been declining because of the huge supply of workers but limited demand as programming shifts elsewhere and new markets emerge overnight. The music industry and Hollywood has been in rapid decline for at least a decade because of illegal downloading and it will only get worse as these companies raise prices to make the few who do pay, pay for the ones who don’t.
It may be rough out there for many but there is plenty of money to made. The real issue that we have come across is that people are scared. When people retreat from fear it keeps them from putting themselves out there in the market and makes them cower. When everyone reflects fear, everyone panics, with good reason and bad. This is the real problem. The ‘uncertain’ times that we are in are just that, uncertain. People have the money to spend for needed services but are hesitant to do so. Housing has always a needed service with an 8% annual growth rate but when people are stuck at home wondering if this is the financial Armageddon, nobody leaves. People stop moving and traveling becomes stagnant. When your average risk on any business venture is multiplied by sensational yellow journalism aimed at earning a buck at your expense, it makes you think twice and then thrice.
This was the real problem to us and many in the hospitality business. Fear controlled our market. I’m hoping because we are back on top that we as a people have suffered, we learned, and we overcame.