I had an intriguing discussion the other day with regard to the prospects of our economy. The conversation took me back to the good old days when I would sit in my grandmothers living room and listen to my father, my mother and my grandpa discussing the state of the county and the economy. My grandpa would say “whew, when is this bubble going to pop?”. My mother, father and grandpa would talk into the night about the greed of the real estate industry and the odd perceptions of the marketplace.
I cannot help but smile when I remember these discussions. My father and my mother were both well-educated real estate appraisers; my father, a past national president of a prominent appraisal organization. Yet my grandpa, who finished the third grade before he started his long-standing career in the 1920′s, had the greatest understanding of the economy and the motivations of people. Sometimes we need to remember that no matter how “smart” the market analysts are, the market is still made up of people. These people have basic needs, and yes, the market prices are easily driven up by greed, or down by a glut of REO properties. But at the end of the day, when all the dust settles, the real estate economy is still primarily an open marketplace where willing buyers and sellers interact. The basic needs and motivations have not changed and as long as there are families, schools, grocery stores, parks, and centers of employment, the basic considerations of the marketplace will remain unchanged.
This blog entry is not intended to “fix anything” or even recognize anything. It is only intended to remind all of us that are in the profession that the objectivity, impartiality and independence of our analysis is paramount to the overall health of the marketplace so that buyers and sellers have a fair and open marketplace to buy or sell. Too many times I have found appraisers, loan officers and real estate brokers who are so focused on “making the deal work” that they lose focus on the fact that these deals are dependent upon people. It is the people, the general public, that we are here to protect. “How do we protect them?”, you may ask. Just keep it simple. Develop our research with an open mind, looking at all the data, analyzing the data with no preconceived notions and report our findings in a manner that is not misleading. The rest will take care of itself. And, before anyone tells me this is idealistic and naïve, I know, but every once in a while I want to believe the best of people, even regulators, lenders and attorneys. Play nice out there and I will see you around the water cooler.