Calmer Waters

Another year has passed and I have 5 years of real estate business completed with my own company and what a ride. I have often said that “I don’t mind sailing in rough waters, but I do want to get safely back to port”. It has been over 30 years ago that I started selling real estate in the Alexandria community and I have really enjoyed my work and the people that I have worked for. Starting a real estate company at the beginning of the Great Recession was probably a lot like base jumping and hoping your chute will open. Once you’ve jumped, all you have left is faith…and some good equipment. In my case, once I jumped; I needed a lot of faith and a good team to fulfill all the details that are required in a real estate transaction. The staff at my office, I believe, is the best in the business. Most of my clients will tell you that they make me look good, and they do.

As far as the Alexandria, MN markets go, there are improvements in all sectors. From new construction to commercial, we have seen improved sales volume for the year 2012. Pricing has not fully recovered to pre-recession levels though and I do not know when that will happen. We need new home construction to return first and then pricing for existing homes will follow in an upward trend. All of existing home prices are based on cost of replacement. If we are not building new homes, then there is too much inventory of existing homes for the amount of buyers that are available to the market and prices suffer (Economics 101: Supply and Demand). What we are seeing now is demand is starting to increase and the supply is starting to dwindle. The Case-Shiller price index for Minneapolis is showing that prices have increased (see December 19, 2012 blog) from the low. That is great news as every market declines to find its bottom…it appears that they may have been already, and then the cycle continues back up. According to that report, prices are still approximately 30% below the high of 5 years ago. For me, in all my years of real estate, real estate has had a positive rate of growth. The returns were never too exciting, but positive nonetheless. Losing 30% of value in a few years time was never on the radar so when it happened, it was cataclysmic.
If the market in fact has bottomed, the next few years should produce some positive growth for those that do own real estate. That’s good news that we have waited for a long time (or at least it seems like a long time).

Consumer Confidence, at its highest level in 4 ½ years (read December 19th, 2012 blog) is touted as the key truth detector of the economy. I have been faithfully tracking it monthly since September 2008 and I am very excited about this most recent report. The Index was at 140 points in 2001 with a low of 25.3 in February 2009. In an effort to give folks the best possible real estate advice during 2008/2009 in an economy that we had never seen before was very, very difficult. Emotionally, I hope that I never have to deal with that again. When you look at where we were with the Consumers Confidence…25.3 points, that’s like no confidence in the economy. The American people showed their resilience in tough times, I am proud to be a part of this country and its future.

The Alexandria Area High School is coming out of the ground. With a 56% voter approval, you cannot say it was an overwhelming majority. But in the school bond business, that is still a sizable victory for the new school. This new school will serve to shape the destiny of this community for the next century. It will show the world that this community is concerned about educating its young adults and shaping their lives for the better. This attitude will mold the building blocks that make up Alexandria and its soul as we move forward with life. You add in the positive environment of the Alexandria Technical College and all of a sudden you have a community that is training minds for future jobs and problem solving. What if Alexandria, MN was to be known as a learning center? It could happen as right now in this region, we are known for our retail, medical, good jobs (Douglas Machine & Scientific, Aagard, Brenton, Tastefully Simple, Knute Nelson, Arrowwood, 3M, Central Specialties, SunOpta, Donnelly, D. Cty. Hospital, 206, Alex Extrusion. Alex Tech, PrimeWest, ITW, ProFab, Henry’s Foods, Randy Fischer Real Estate…that’s over 5000 jobs)…what if education was our biggest export? The new high school, I believe, will move this town farther and faster in the right direction.

My personal sales volume at Randy Fischer Real Estate is at pre-recession levels. I have the utmost optimism for the future, as I always have. This is a great town with great people that all seem focused on a better life. 2012 is going into the record books as a year that was not without strife, but one that makes the future reappear with a brighter light. A quote that I like is “As we sail thru life, don’t avoid rough waters, sail on because calm waters will not make you a skillful sailor”. If you are reading this article, you can be proud to have weathered the Great Recession. It maybe could have been worse. Another quote that may summarize the past from Louisa May Alcott; “I’m not afraid of storms, for I’m learning how to sail my ship”.
So I feel that I was in the storm of the century and now the waters are calm; I think that I may stay here for a little bit and enjoy this market.

Thank you to all the folks and friends that made up my year of 2012. It was another record year for us. We’ll be here again next year, setting sail and knowing me…probably to uncharted waters.