Take a look at this piece of reporting

Allow me to break it down further, to the bare essentials of what happened during the fourth quarter of 2009.

1. Sales of existing homes were up 27.2% during the last three months of 2009.

2. Single-family prices fell 4% – the smallest price decline in more than two years.

3. Garry Benson (that’s me) asserted in a Q4 Crain’s article that “the market has stopped going down.” One commenter asked me if I was insane. I replied with a post entitled: Garry Benson, Are You Insane?

Hindsight is 20/20 of course, but during the time of my quote and article (Q4), things WERE indeed getting a little better, or at least slowly correcting, reversing course – no insanity necessary.

Please don’t interpret this as gloating. My comment had been based on a gut feeling after watching 12 mil worth of real estate sell in one day.

Today I stand on much more solid ground when I suggest that maybe the market has stopped going down. That’s good news for all of us – we can really build a case for rational optimism for 2010.

Go ahead and check out the original NAR report, and let me know how you choose to interpret the new data. We at Garrison Partners would love to hear your take on it, insane or otherwise.

GB

An article posted by the NAHB today reports that the mood of attendees at this year’s International Builders’ Show was cautiously optimistic.

I was there, and the energy was indeed more upbeat. The networking and communicating is great for the industry, and there’s a certain power in numbers, a sense of energy that breeds cautious optimism.

But I saw something else at the IBS show. Something very good for the industry: rational optimism.

Rational optimism bases your expectations on what you KNOW to be true.

Cautious optimism limits your expectations because of all the unknowns involved.

Rational optimism is earned by seeking out the projects you can grasp fully and get excited about. Putting in honest work and street-level research and taking your best shot, no regrets.

Cautious optimism happens when you lack information. It’s a result of moving forward into the unknown too quickly for your confidence to keep up with you.

Rational optimism can save the residential real estate industry.

Cautious optimism threatens to hold it back.

I’m involved with several projects right now for which I can be rationally optimistic. They’re the only projects I’m willing to take on. I’ve discovered that you can hold yourself to this standard EVEN IN THIS ECONOMY. In fact, it’s more important now than ever.

For banks, receivers and developers in particular, rational optimism is the holy grail. In order to achieve it, intelligence gathering techniques and depth of insight have to adhere to a new standard. Well, new to some. To us, it’s business as usual.

OK, admittedly, I can recall a few times in 2008 where I indulged in cautious optimism. However, I’m very optimistic it won’t happen again. (Rationally so.)

Garry