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Slide 1: Wisdom Comes From Experience In Real Estate As In Life It is considered common sense that wisdom comes from experience. As it relates to the real estate market most would say that the wisdom gleaned from the last few years is that the market was over inflated, even to the point of being a bubble. Some would say that it was a self-fulfilling prophecy, that most of the appreciation in the market was not sustainable because of so much exuberance. Which came first: the exuberance over the appreciation or just the exuberance that threw out sound judgment and common sense. But where we go from here is the question of the present market, has it gone down as far as it is going or are we creating a self-fulfilling prophecy of a increasingly depressed market, in effect exuberance swinging the other way to the point that the sky is falling. The last real estate cycle similar to this one occurred in the 1990's, and the economy was officially declared a recession then as well. What we learned from that period is that it took 7 years from the peak of appreciation to get back up to that level of value again. So if the peak for the Northern Virginia market was 2005-2006, then we are looking at 2012-2013 to be back up to that level of appreciation and perhaps greater actual value being added. It is my view then that we are further than half way through this cycle and thus more than likely the bottom has come and gone or is very near. Don't miss this opportunity due to fear. In this light, I have been contemplating a quote by author and humorist Mark Twain: We should be careful to get out of an experience only the wisdom that is in it - and stop there - lest we be like the cat that sits down on a hot stove-lid. She will never sit down on a hot stove-lid again, and that is well; but also she will never sit down on a cold one any more. (1835-1910) So should one not invest in real estate because of the fact that there were so many people overpaying and driving the market up to unsustainable levels? What if you continued waiting so long that you actually waited through the bottom of the market and missed a golden opportunity. That would be like the cat who would never sit down on a stove-lid again for fear that it may be hot. My daughter is an equestrian and has fallen off her horse many times. But that doesn't mean she doesn't ride again, she dusts herself off and gets back on the horse. In my view it is time to dust ourselves off and get back into the market. Good houses priced right for the present market are selling. The important thing is to operate in the market one is presently in, not reminiscing about the past market and not over compensating in the other direction and over depressing the market. Long Beach Island Real Estate