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My Realtor’s Two Main Clients: The Wealthy & The Poor

by J. Money on Tuesday, October 11, 2011

think rich look poorI actually ran into him the other day at a coffee shop, and asked him what he thought about this current marketplace.  He said he’s never been busier!  For him, that’s saying something :)

He was killing himself 5 years ago when we bought, and now with all the foreclosures and short sales, he’s been running all over the place closing deals!  And interestingly enough he says he’s primarily only dealing w/ two sets of people right now:  the REALLY rich ones, and the REALLY hard on their luck ones.

It makes sense if you think about it.  The Rich are buying up all the homes with depressed values (and I don’t blame them – it’s a smart move!) and the less fortunate are losing them left and right while struggling to keep afloat.   Much different than when we first spoke years ago and he was closing deals across ALL classes — including us, who were just about middle class back then. It really adds to that whole idea that the rich keep on getting richer, and the poor keep on getting poorer.  (They actually had something on that, too, in TIME mag the other day – the fact that the middle class is starting to disappear more, and the gap between wealthy and poor widening.  Freaky stuff.)

So what does that mean for people like you and me?  Well, house prices sure are cheap!  And if you happen to be looking to buy right now, you can count your blessings that you’re getting in at a damn good time to do it.  Lucky bastard ;)  I still wouldn’t jump at it cuz of my own personal realization w/ home ownership, but for the majority of people out there I’d say it’s probably a good investment.  Though I’m obviously not a pro, as I sit here in my $60,000 underwater townhouse! ;)

It all just goes to show that life’s a ride, man.  Sometimes you’re up, and sometimes you’re down.  But if you can get that good structure underneath you (and by that I mean a good financial game plan – whether that’s a budget, increased savings, a better job, etc), the odds that you’ll be thrown for a loop decreases significantly. At least when it comes to money.  Think about where you were 5 years ago, and where you’re at now.  Are you a lot more farther along?  Do you have more of a cushion underneath you in case something crazy happens? I know we do.  And I’m sure that if we keep on hustling, and workin’ the plan for ANOTHER 5 years we’ll be even BETTER well off.  I think that’s the goal we’re all shooting for.

So when you’re out and about there making decisions, ask yourself if it falls under your “larger picture” umbrella.  If it does, great!  Keep on moving right along.  But if it doesn’t – ask yourself if it’s really *worth it*.  Sometimes it will be – like, for example, treating yourself to something fun like a vacation or nice pair of shoes – but other times it won’t.  And the trick is catching yourself before you’re convinced it totally aligns ;) Believe me, it’s hard as hell to catch MYSELF sometimes!  Haha… I do a lot of things to trick myself into thinking lottery tickets and Woot.com are my friends ;)  It’s only natural.

At the end of the day, though, if you can make sure you’re just ONE more inch closer to that finish line as you drift off to sleep each night, the progress you’ll make after the next 5 years, and the next 5 years after that, will turn out phenomenal.  And it all starts with acting TODAY.  The years are gonna pass by no matter what we do, but it doesn’t mean we can’t be prepared for it!  Get out there and impress yourselves, friends.  If you don’t watch your money, who will?


{ 13 comments… read them below or add one }

1 Vanessa October 11, 2011 at 8:18 am

I wish I had enough cash to gobble up cheap homes :P

Did you get your realtor to reevaluate your townhouse?

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2 Ashley @ Money Talks October 11, 2011 at 11:23 am

Makes total sense that only the rich and the poor are dealing with the market right now. I’m glad that the realtor is busy, activity can only mean good things for the market. It’s picking up in my area for sure. Houses are selling in weeks instead of months and months.

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3 J. Money October 11, 2011 at 11:36 am

@Vanessa – One day you will! :) And no – I didn’t :( But I really want to – I just don’t want to waste his time unless I’m going to use his services ya know? He’s always been so good to me and as I mentioned he’s CRAZY busy, so if I get him to hook me up I’m gonna feel bad (again) for not doing anything about it – like try and sell it or rent it out. I keep telling him I want to rent it out but never act on it cuz we’re not ready yet. But one of these days we will! And then you can bet your bottom dollar I’ll get the updated value again :)
@Ashley @ Money Talks – Oh nice! I love it when things go faster too – it gets freaky when you see the same houses on the market for months at a time. I really hope this isn’t the new “normal.”

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4 Agatha Kulesza October 11, 2011 at 3:12 pm

I think we are really fortunate to be young people in these times of unstable real estate. Even if you are upside down on your townhouse you still have plenty of time to recover. My heart goes out to the baby boomers who put their life savings in their homes, hoping they could retire off the money they made when they sold it….and many of them can’t sell their home now. I think we’ve all learned that although real estate is still a good investment, it’s probably not the best idea to put all your retirement hopes and dreams into one basket.

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5 Jenna, Adaptu Community Manager October 11, 2011 at 5:42 pm

Thanks for the mental butt kick. Guess I’ll check out some more houses online tonight.

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6 Stephanie October 11, 2011 at 7:35 pm

Maybe it’s just a matter of most of my friends ending up with about the same educational level and similar income levels as me, but we’re all pretty solidly middle class and an awful lot of us have bought houses over the past couple of years!!

But as Agatha mentioned, we definitely benefit from this because we’re young. We were able to take advantage of a bad market by getting houses at low prices and getting low interest rates. In fact, I found out that my husband and I pay about $200/month less for our mortgage (including taxes and insurance) than a renter in our area would expect to pay for a similar home, so we’re not just building equity, we’re saving an additional $2400 a year by owning instead of renting. Not a bad deal. ;-)

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7 J. Money October 11, 2011 at 10:15 pm

@Agatha Kulesza – Agreed! The “American Dream” isn’t so dream-like either, even IF the markets were nice and sexy like it was back in the day. I realized after year 1 that I am not cut out for home ownership no matter the financial perks ;) All good things to learn while young, for sure. Thanks for stopping by!
@Jenna, Adaptu Community Manager – Only if it’s something you truly want!! It’s the largest purchase of your life, so make sure it’s a high priority ;)
@Stephanie – That’s not a bad deal at all, you’re right. And I’m glad you’re feeling good about home ownership too! I’m done with it, haha…

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8 Martin October 12, 2011 at 12:07 am

I love the message in this piece. I truly believe that when in doubt you should always take the next small step. You won’t always be able to take leaps. A small step is better than standing still.

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9 J. Money October 12, 2011 at 2:49 pm

Yup! And it’s probably best to take small steps than larger leaps anyways ;) Less chances of getting caught up in something crazy.

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10 Bergie Powers October 12, 2011 at 9:24 pm

Love the ‘sometimes you’re up, and sometimes you’re down.’ Even though now I am in the ‘sometimes you’re down part,’ I can enjoy memories of when I was up, and look forward to being up again in the future (I hope)! Unfortunately, I am on the real estate end of loosing my home within the next year or so, and definitely struggling to stay afloat. But I can still financially plan for a great future with a cheap apartment, and it is nice to have something positive to work toward.

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11 J. Money October 13, 2011 at 3:42 pm

Awww I hope it gets better soon my friend! That’s pretty harsh for sure. But it’s totally true — without the bads you can’t even APPRECIATE the goods, ya know? Both are always needed, though ofcourse it’s much better when things are going UP more for sure ;) I’d much rather not appreciate it as much if it means everything’s going sexily, haha… keep us updated with everything, okay? And let us know if we can help out :)

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12 Natalie @ Mango October 13, 2011 at 5:22 pm

Thanks for the post, J. Money. To me, buying a home has always seemed like something I would do eventually; something I’d do “when I grow up.” But it seems like I blinked and when I opened my eyes, I just might be… a…. grownup. How did that happen?! Anyway, my parents have been asking me lately if I might start looking into buying a home, and, honestly, about two months ago, I laughed this off. But now, with the home prices where they are and, like you said, with a little more “cushion” in my life, I think I might just start looking into it. So long as you’re not getting into something that you really can’t afford, it seems like the time really is now! So thanks for the inspirational post!

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13 J. Money October 14, 2011 at 11:16 am

Yeah girl! For sure… I hear you on the “growing up” part too… for a 30 y/o I surely don’t act like an “adult” ;)

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