If the sun seems a little brighter lately, there may be a reason for it. For the first time in well over five years, the Dow is finally back above the 14,000 level, where it was in October 2007, just before our economy hit the biggest air pocket since the Great Depression. During the crash, assets of all types seemed to go into a free fall — stocks, homes and commercial properties. People watched as their retirement accounts fell to a fraction of their former value.
But just in the last few weeks, we’ve seen the Dow climb back above 14,000. I don’t want to overstate the impact of that, because the Dow isn’t the best indicator of where the economy is. But it has a major psychological importance, because it’s still the indicator the press mentions most. And getting above a barrier like 14,000 can give folks a lift. After well over five years — at least by that measure — we’re finally clear of the horrendous downturn.
And we’re seeing positive signs in the real estate market, too. In January, home prices — as measured by the Case-Shiller Index — showed the biggest year-over-year gain since before the crash. The National Association of Realtors reports that sales of vacation homes were up 10.1% in 2012, and the median price of a vacation home rose by 24%. When people get scared, luxuries like vacation homes get hit first. So when beach homes and condos start to recover, it means people are feeling pretty good about things.
As I’ve noted recently, we’ve been seeing signs of the upturn in our auctions. Our series of five auctions in late March demonstrated the strengthening economy in a dramatic way, as we had capacity crowds and vigorous bidding all over Georgia. Ultimately, the total reached $17.5 million, as hundreds of bidders purchased homes, commercial properties and land to position themselves for a stronger economy.
The economy is notoriously difficult to predict, so it’s hard to tell what’s ahead. But all the momentum seems to be positive right now, and there are a lot of opportunities ahead. Our buyers know that those who prepare now by accumulating assets will be miles head in the months and years to come.