What’s Happening to the Value of my House
We are constantly getting calls from real estate agents and consumers asking us if the value of their house (or the house they are thinking of buying) is going to go down because of the coronavirus.
As anyone who has used us as their lender, or as anyone who has referred someone to us to be their lender knows, we make it our business to stay on top of things. We don’t just listen to the mortgage lending and real estate trade organizations, mainly because their main function is to constantly pump out positive news with the goal of encouraging consumers to buy houses. Some of what they dispense is useful, but most of it is nonsense.
Here’s what we have to say about house values.
Before we get to that, though, we’d like to pass on something that my father banged into my head when I was a child. It made no sense to me then, but it sure is apropos now.
He who knows not,
and knows not that he knows not,
is a fool; shun him.
He who knows not,
and knows that he knows not,
can be taught; teach him.
He who knows,
and knows not that he knows,
is asleep; wake him.
He who knows,
and knows that he knows,
is a wise man; follow him.
Upon hearing this verse, most people consider themselves to be wise men. However, the unspoken message here is that there is fine line between a fool and a wise man. Almost universally, fools believe themselves to be wise men. Wise men, on the other hand, are constantly questioning themselves. The highest level of critical thinking is the ability to be comfortable knowing you don’t know everything. If new information presents itself, the critical thinker considers it, and if that new information adds to the critical thinker’s knowledge (remember, information and knowledge are not the same thing), the critical thinker may change his mind. Contrary to popular wisdom, flip-flopping is not only acceptable to the critical thinker, it is embraced.
We live in a time in which most of us consider ourselves to be wise men. “Only a fool would wear a mask. Only a fool would not wear a mask. Only a fool would believe the government. Only a fool would not believe the scientists. Only a fool would vote for Trump. Only a fool would not realize Trump is the greatest president we have ever had.”
The reality is that very few of us are wise men (or women). We get our news pushed to us based on what we’ve already shown an interest in. We watch Fox News, or MSNBC, or hang on every word we see on social media, absolutely convinced we are wise and those who think differently than us are fools.
Unfortunately, we often base our financial decisions on foolishness, just as we base our political decisions on foolishness.
And so, knowing I could be mistaken, but being entirely comfortable with that because new information will inevitably present itself, and that information may or may not become useful knowledge, which may or may not cause me to change my mind, I tell everyone who asks that I believe values for Metro-Denver houses will not decline. I will explain how I came to this conclusion next week.