Vultures Infiltrating Your Neighborhood
An investment bubble occurs when something happens that causes investors that normally wouldn’t buy, to jump in and buy anyway. For example, the housing bubble occurred when of lax lending standards prompted unqualified buyers to purchase homes they couldn’t afford. Because the supply of homes couldn’t keep up with demand from buyers, prices skyrocketed. This artificial demand increased exponentially as investors, anxious to participate in quick profits began purchasing.
In reality, this turned out to be the worst time to buy. When too many investors or buyers jump in too quickly, the price pendulum swings way out of whack causing a bubble. Once a bubble is identified investors begin aggressively selling in an attempt to minimize loss. Instead of prices returning to realistic levels, they end up going down too low. When the pendulum swings too far in the opposite direction, fantastic buying opportunities are created. Vulture funds from other predatory investors make fantastic profit by recognizing and exploiting the window of opportunity that occurs when prices over correct.
Most recently this happened with the stock market as the Dow lost over 50% of its value, and recovered most of it. Savvy investors jumped in when the market was low and were rewarded handsomely.
There’s every indication that the real estate market has over corrected because of the massive supply of homes and severe foreclosure problem. Recognizing this over correction, vulture funds are now fighting over the unprecedented profits that can be found in home prices.
Many of these homes can be found in your own backyard. Shouldn’t you be taking advantage of this tremendous opportunity too?