| As the real estate market cools off across the | | | | The gains you have made over the last five |
| nation, many people are getting nervous about | | | | years or so appear to be under attack at the |
| reductions in the value of their property. There is | | | | moment. Across the nation, we are seeing a pull |
| little reason for such stress. | | | | back on home values because of a cooling real |
| Staying Calm When Home Values Drop | | | | estate market. It is important that you don't |
| The real estate market can be looked at in two | | | | overreact to this pull back. The gains you have |
| ways. First, you can look at the movements on a | | | | seen in the last few years were paper gains, to |
| monthly or annual basis. When doing so, you will | | | | wit, they did not put money in your bank account |
| see moves up or down and perhaps stress | | | | unless you pulled money out of your home. As |
| yourself out far more than necessary. | | | | home values cool, it is important to realize any |
| Alternatively, you can look at prices on a | | | | loss of equity is also a paper loss, to wit, you |
| long-term perspective of five years or more and | | | | aren't paying anything out. |
| predict where they will go based on historical | | | | A map of real estate prices over the years would |
| trends in real estate. By far, this second approach | | | | show a continual up trend. Yes, there are |
| is the way to go when it comes to viewing the | | | | variations over a two to three year period, but |
| value of your home. | | | | the overall trend is an increase in property values. |
| Unless you live in Texas or Colorado, there is no | | | | There is no reason to believe this will change |
| denying that you have probably seen significant | | | | anytime soon. The current pull back on property |
| appreciation gains on your home over the last ten | | | | values will pass and your home will start |
| years. The market has been about as hot as it | | | | appreciating again. It may take a year or two, but |
| ever has. Properties in Las Vegas, for instance, | | | | it will happen. Relax! |
| were appreciating at a staggering rate of | | | | If you are seeing a pull back on the value of your |
| twenty-five percent or more a year. A YEAR! On | | | | home, you should not sell unless there is some |
| paper, a lot of people became millionaires because | | | | other compelling reason. Practice patience and you |
| of the equity gains in their home. As always, such | | | | will see prices rise again in the near future. |
| growth could not be sustained inevitably. | | | | |