But an industry that won't move until it is certain of days as good as its golden past is effectively dead, from a strategic point of view. Besides, there is an alternative if you don't have the faith or will or courage needed to accept reality and deal. The alternative is to drive the property to a profitable demise.
March 2005 Archives
Will the real estate industry continue to spend substantial sums on legacy newspaper advertising? Prudential Equity Group issued a report that found circulation quality and quantity continues to decline.
Warren Buffett's annual shareholder letter includes a big pat on the back to HomeServies CEO Ron Peltier, along with earnings information:
MidAmerican also owns a significant non-utility business, HomeServices of America, the second largest real estate broker in the country. Unlike our utility operations, this business is highly cyclical, but nevertheless one we view enthusiastically. We have an exceptional manager, Ron Peltier, who through both his acquisition and operational skills is building a brokerage powerhouse.HomeServices 2004 earnings were $130M, up from 113M in 2003.HomeServices participated in $59.8 billion of transactions in 2004, a gain of $11.2 billion from 2003. About 24% of the increase came from six acquisitions made during the year. Through our 17 brokerage firms – all of which retain their local identities – we employ more than 18,000 brokers in 18 states. HomeServices is almost certain to grow substantially in the next decade as we continue to acquire leading localized operations.
Kelly Zito:
Las Vegas' lucky number last year was 52 -- as in 52 percent. That's how much real estate prices jumped in the nation's fastest-growing city in one year, as a housing shortage set off a wave of speculation by investors from California and other states.But as any gambler knows, Lady Luck eventually turns a cold shoulder. Las Vegans wanted to cash in, too, and so many put their houses up for sale that they flooded the market. By the end of the year, some homebuilders were slashing prices.
Within six months last year, Carlos and Betti Lidsky bought and sold two condominiums. Then they bought and sold two houses. They say they will clear a half-million dollars in profit, and none of the homes have even been built.Now Mr. Lidsky, a lawyer, and his wife, a charity fund-raiser, have put down a deposit on a fifth property, a $1.3 million condo in a high-rise under construction, and are planning to sell before the deal closes, without even taking out a mortgage.
"It is much better than the stock market," Mr. Lidsky said. "This is an extraordinary, phenomenally good result."
