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Why a Real Estate Broker Can Have a Bullish Opinion on Housing, and Why Investors Should Take Note

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After publishing "10 Reasons to Be Bullish on Housing" many readers dismissed my take because I work in the industry, but their lack of confidence actually pushes me to be more bullish.

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No matter how many times it happens, it still hurts. A little. Last week, after posting 10 Reasons to Be Bullish on Housing, an optimistic take on residential real estate, I got lit up. (On message boards outside Minyanville, that is).

"Self-serving load of delusional swamp gas," "pathetic palaver and drivel," "garbage propaganda," "drunk," "crackhead or an idiot," "a bunch of crap," "as dumb as an article gets," "cranial capacity of a flea," and my personal favorite: "what a dofus." Yes, that's dofus, with one "o." But who's counting?

Scattered amongst the anonymous attacks were a couple good points on why I was off base. Baby boomers retiring and looking to downsize their housing situation, a job market that is weaker than data indicate, persistently tight lending conditions, and a few others. And mostly, I wouldn't disagree with these arguments. Rarely is a viewpoint so obvious that rebuttal isn't possible.

But the most common refrain amongst the naysayers didn't have anything to do with logic, or data, or economics. Instead, most people dismissed my opinion because I work in real estate. That simply because I am in the business, my positive commentary should be lumped in with absurd Realtor cheerleading and mindless calls that it's (always) a great time to buy.

Fair enough, but as a lone poster pointed out, for years I have been bearish and critical of the spin doctors at the National Association of Realtors, and real estate agents in general. In some cases, my pieces earned me harsh words from my colleagues (and praise on the message boards).

So let me be perfectly clear: I own a real estate brokerage and we get paid to close transactions. But more than a real estate brokerage, I own a small business. And as any small business owner will tell you, if you don't have your word and your integrity, you have nothing. In late 2008 and early 2009, when my business was teetering on the edge, I told people not to buy. I turned away business and almost had to close up shop. I did this because I thought it was the right thing to do, that prices were still in free-fall.

But we survived, and early last year I turned bullish. Not to be self-serving, or to earn more commissions, but because based on my experience and what I saw in the market, I believed that the time for bearishness had passed. I saw reward, when the opportunity was chosen correctly, start to outweigh the risk. And we began advising clients to buy, selectively.

I can proudly say that each of our clients, from families to professional investors, has made a good decision. Some have even made money. Others now live in a house where they are settling down to raise their family -- for less than it costs to rent. In a city like San Francisco, where the rent-versus-buy ratio is consistently among the worst in the country, that isn't easy to do.

I look around and all I see is opportunity. And this holds true well outside real estate. There is opportunity everywhere. If you look around and only see apocalypse, chances are you aren't looking very hard.

Nearly without exception, every businessperson I talk to, from employees at Apple (AAPL), Google (GOOG) or Chase (JPM), to advertising executives, headhunters and HR people, is optimistic. My message board friends dismiss confidence as an economic indicator. They are wrong. They have likely never been in a position to hire or fire, to reinvest in their business. Confidence makes all the difference because it drives change. If you ignore anecdotes and insight from the trenches, in other words the rumblings of recovery, waiting instead for backward-looking economic data to turn positive, you will show up late and wonder why you missed it.

So, to all my new friends with names like "Yahoo! User" and "B," keep it up. Every time you rip into me, I get a little more bullish. It's when you start agreeing with me again that I'll start to get worried.


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