November 2019 Monthly Letter
When I was a kid, I eagerly awaited my monthly issue of Boy’s Life Magazine. I would devour the stories and projects and adventures of others. Then I would read the ads in the back. I would beg my parents to buy me the pet sea monkeys. I had visions of little friendly sea horses or mermaids that I could play with. My parents would explain that there was no such thing as sea monkeys, and it was a rip-off. But I would not relent (I was a good salesman even then). Finally, my parents ordered them. When they arrived, we followed the directions and low and behold we had purchased a pack of tiny (more like microscopic) brine shrimp. You can imagine my disappointment! I have to say this is one of the great lessons my parents taught me. Since then I pay very little attention to advertising and try to be a good critical thinker. So, lesson be had…do not buy the sea monkeys!
We’ve all heard that we only use about 10% of our brains. In fact, we use 100% of our brain and the problem is that we face overload quickly, so where we focus our attention is key – goals, to-do lists, financial plan, etc.… Every day, a sea of decisions stretches before us. Some are small and unimportant, but others have a larger impact on our lives! We don’t always make the right decisions but if we apply sound critical thinking skills, we can sift through the sea of data and achieve our goals. Fewer sea monkeys and better real estate deals. Here is a five-step process that might help you.
- Formulate your question. In other words, know what you are looking for.
- Gather your information. There is plenty of data out there. The better you refine #1 above the easier this becomes.
- Apply the information. You do this by asking questions. What concepts are working? What assumptions exist? Am I being told the truth? Don’t fall for the sea monkeys!
- Consider the implications. If you follow the path will you be happy? You hear owing apartments is a good plan – do you want to deal with backed-up toilets in the middle of the night? You want a fully triple-net deal – can you afford a long zero income vacancy when you have to re-tenant?
- Explore other points of view. Ask yourself why so many people are drawn to the policies of the opposing political candidates.
I have talked about this before, but we have a bubble in the cost of education and the giant burden of student debt (more than auto and credit cards combined!). The cost of a four-year degree has shot up 15x in the past 40 years. If car prices jumped as much as tuition, a base model Toyota Corolla would cost $90,000 today.
On the positive side, large universities like UC San Diego fuel our regional economy. UCSD has more than $5 billion in annual revenue and .2 billion in annual sponsored research. A recent Tripp Umbach report cited UCSD as contributing about $16.5 billion in annual impact in California. That’s more than the entire revenue of the State of Arizona!
In our day to day battlefield, we continue to see constant crosswinds. Deals continue to happen but not as many as we should see at this point in the economy. We have seen the first rise in mortgage defaults since the financial crisis. But just as that happens rates fell – so stay tuned. We at CDC also had a couple of firsts. We were in escrow representing a buyer and the seller decided they didn’t want to sell. Well, you can’t just do that. A buyer can sue for specific performance. In our case, a settlement was arranged, and a new property was found. In another case, we represented the seller and the Buyer had signed contracts in escrow, but no deposit arrived and no communication – crazy – but we’re back working with several new buyers. These are not the kind of “First” we like to have!
Unemployment fell again in San Diego to a 20-year low of 2.7% in September. There are still more jobs than the number of unemployed San Diegans. This is a positive sign for leasing and sales.
Investment volumes overall are trending lower this year compared to 2018. Being a critical thinker, you must realize that 2018 had a large increase in merger-and-acquisition activity which helped to supercharge last year’s numbers.
Because of the low unemployment numbers and job growth, there seems to be an insatiable demand for housing. However, the other sector that is just blossoming right now is healthcare. We have an aging population. By 2030, the population of people over the age of 65 will double and approximately 6 out of 10 boomers will be managing one or more chronic conditions.
And now from the other corner of our office, here are Nick’s numbers for the month;
San Marcos – Current Market Statistics:
Please give me a call or email me if you would like more in-depth info on San Marcos or other San Diego and North County sub-markets (Nick Zech, 858-232-2100, firstname.lastname@example.org).
On my recent trip to France, I had the good fortune to visit the Chateau that Leonardo da Vinci spent his later years living and tinkering. This inspired me to read Walter Isaacson’s biography on de Vinci. I was inspired by this quote and think Leonard would have done as well in our time as in his own.
“His ability to combine art, science, technology, the humanities, and imagination remains an enduring recipe for creativity. So, too, was his ease at being a bit of a misfit: illegitimate, gay, vegetarian, left-handed, easily distracted, and at times heretical. Florence flourished in the fifteenth century because it was comfortable with such people. Above all, Leonardo’s relentless curiosity and experimentation should remind us of the importance of instilling, in both ourselves and our children, not just received knowledge but a willingness to question it—to be imaginative and, like talented misfits and rebels in any era, to think different.”
As we prepare for Thanksgiving house guests and wrapping up the year and using our critical thinking skills to achieve our goals for 2020, we want to thank you for your business. I hope you enjoy the Zen Story.
Treat your thoughts as if they were houseguests in your mind. They come and then they go. Sometimes they are fun, and sometimes you can’t wait for them to depart – but eventually, they always leave; sometimes they do make a mess of things though.
Thoughts are fleeting and have no real home in your head. Memories hang around, but thoughts are transient states that ebb and flow through your consciousness.
Sometimes we become obsessed with a thought, a worry, an expectation and it seems like we just can’t get away from this unwanted guest, but that is all it is, an unwanted thought. Realizing that your thoughts are not you and that they are just a flash that will soon fade. This takes away a lot of stress and worry.
A thought is just an electrical burst in your brain but is not part of your brain. Think of a lightbulb – apply electricity and the bulb glows bright, but the bulb is not electricity, neither is a thought you – it’s just a guest.
Watch your thoughts; they become words.
Watch your words; they become actions.
Watch your actions; they become habits.
Watch your habits; they become your character.
Watch your character; it becomes your destiny.