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A hint of optimism

Is this the turn in the downcycle I've been waiting for? Well, I got a note from one of the loudest naysayers I interview every year for Emerging Trends. This gentleman has been warning me since 2004 of the imminent demise of the market -- "amateurs overpaying,"  "people who do not...

By Jonathan D. Miller | Updated on March 23, 2008

Is this the turn in the downcycle I’ve been waiting for? Well, I got a note from one of the loudest naysayers I interview every year for Emerging Trends. This gentleman has been warning me since 2004 of the imminent demise of the market — “amateurs overpaying,”  “people who do not know what they are doing,”  “crazy flipping and  too much leverage.”  He said he couldn’t buy in the market, but was happy to sell, and he says he seized gains well above his projections even though property NOIs underperformed his proformas. So here’s what Mr. Pessimism writes me today:

“All the bad news being constantly communicated (and I see you are firmly seated in the middle of that bandwagon), I finally get to feel optimistic.  As you have heard from me the past several years (and I think you gently chided me for the doom and gloom outlook), the pricing levels had to drop and capital had to act more rationally, and I now see I underestimated by a lot the extent of correction that was needed.  Now that the market is awake and hopefully adults are calling the shots, we should be able to invest and make a decent risk/reward return.”

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