Posted by Leonard Steinberg on August 25th, 2013

My jaw dropped as I ate breakfast this morning reading the Times on the terrace over-looking vistas of stone structures with clay tiled roofs, pristine vineyards, lavender and cypress trees in the Luberon Valley (nature in perfect harmony with architecture)…..In an attempt to boost the housing market and ailing economy, some brilliant U.K. politicians are attempting to resurrect a policy to stimulate house-buying by allowing cash-strapped buyers to put down 5% and have the remaining 20% downpayment funded/subsidized by the government……does this sound eerily familiar, although somewhat differently packaged? Surely a program like this can only serve to fuel another housing bubble, forcing up prices (artificially) for a group of people who may not yet be ready for the long term commitment of home ownership?

Other news that troubles me is how fickle investors are: now we read about a mass exodus of capital from BRIC countries now that the fashionable trend of investing there seems to be waning, hopefully temporarily.

Also troubling to me are some bankers who keep attempting to push real estate pricing, higher, higher, higher (again artificially) in an attempt to out-smart one another. They often ignore the words and data provided by us brokers. What happens when this scheme falters: do they abandon the markets and turn to another scheme/sector? I do love my deep-pocketed developer clients who finance their entire projects themselves: its the equivalent of a privately held company compared to a publicly traded one whose primary objective is quarterly gains and short-sightedness as opposed to big-picture smarts and decision-making that is purposeful and intelligent.

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