There are secrets one doesn't share unless masked as a fictional account. My tack is to throw both sides of my personality at readers disguised as "insider" and "outsider" so that they can choose sides without hurting my feelings.
Insider: So, my good friend, how goes the economy? Are you pleased with my forecast of its rapid recovery, the end of the bear market and even higher interest rates?
Outsider: Would it please you if I said that I agreed with your drivel? I believe you love it when I take an opposite side. That makes your vanity shine, for you never admit when you're wrong anyway. But I don't mean to appear ugly; I just grow weary of your rubber-stamping the brokers, analysts and stock promoters whose primary value is to keep people in stocks no matter what the Dow Jones may be doing.
Insider: Is it something I said? I do love it when you grow testy. Are you going to throw that real estate nonsense at me, now -- like the housing bubble? You know what a bubble is, don't you? When fools gather in one place to outbid each other for an overpriced, under-built product.
Outsider: A bubble is what you stock market sophisticates blow out your corn-cobs, when you grow fond of the redundancy of "buy, buy, buy"; as long as it's a stock you're hyping, it's OK. Isn't that the real form of a bubble? I simply remind people that homes are real property and not hype, that a person can check out its value with an appraiser, check out its structure for a couple of hundred bucks and make up his mind rather than listen to you guys fill the day with the hot air of exaggeration. What do you live in anyway, an igloo with worthless stocks as wallpaper?
Insider: Clever. No I do live in a home, a nice one, but I didn't join any mob frenzy to outbid the other fools.
Outsider: Like a share of stock, my man.
Insider (sarcastically): Soon there will be more homes anyway, with your politicians demanding that builders bring more lower-cost homes to the marketplace, through the stupid socialism of inclusionary housing. This will add thousands to each home they build, no matter how tiny. Do you know what a socialist really is? Those who demand the government solve every problem when it really is the capitalists, the free enterprisers who make things happen. Government doesn't solve anything except its own employment and job security. They have no guts, take no risks, and feed oil to the squeakiest wheels.
Outsider: Whoops, I believe I touched a nerve. I love capitalism. It's been good to me, to hang up my shingle and attract clients who pay me for my service. But I have no use for those who leverage other peoples' money to build only the biggest, the most expensive homes, at the greatest profits. That ain't shelter, my man, it's exploitation -- which is one word you left out of your explanation of capitalism.
Insider: Touched another nerve, good. Because it's OK to go after true demand -- whether rich or middle-class. That's called 'satisfying the customer' and that's the great system of free enterprise. What else do you want them to do?
Outsider: I'd like them to also try to explore more urban parts of the city, and build along with local community groups, so that the government doesn't have to become a builder. I'd like the government to assist in building a housing trust fund so that there are lots of bucks around to buy entitled land and build in the price ranges that are really, desperately needed by the forgotten masses. That's not socialism either. It's as much free-enterprise as any builder needs to ply his trade.
Insider: And I guess you also want controls on apartment rents because they are too expensive. Isn't that your answer to that crisis?
Outsider: Nope, you're wrong. I'm looking for solutions, not more crisis. Rent control is an extreme measure because it is really punitive to the landlords, the apartment owners. It never works except to drain profitability from the free enterprise system, punish the most unpopular term ever created, "landlord," and cause less rentals to be built. Apartment builders exit that town as fast as possible. This is fact, not opinion.
Insider: So what's the answer, to make Uncle Sam and Uncle State the new builder, with subsidies and profit a dirty word?
Outsider: You know I don't mean that. The solutions are to have housing and land trust funds buy up some of the available land so that it doesn't inflate beyond reasonable levels. To have politicians learn about how to get more supply created, to promote partnering between the community development groups and the private sector, and on designated 'trust land,' set upper limits on inflationary levels of its appreciation. And to get public pension funds to be partners in all of this, to protect their pensioners' need for affordable shelter and retirement housing. In addition to their business goals, they must have some social good as their motivation.
Insider: I agree with most of that. We both know there can be additional answers when there is an attitude of solving the crisis instead of pointing the finger at "the enemy."
Goodkin, an international real estate adviser and strategist, has been a housing analyst since 1956. He can be reached at email@example.com.