Buy SMART - buy countercyclically!

by Adrian Wassmer

Buying real estate "countercyclically" means making investments that run opposite to the general market cycle.

It essentially means buying when the market is down or nearing its bottom, with the expectation that the asset's value will appreciate as the market recovers.

Max Fear Level in the Market is when the prices are the lowest. What works for all Stock Traders, has also some truth for Real Estate Investors.

Here's a breakdown of the key elements of buying countercyclically in real estate:

Buying at the Bottom: A countercyclical investment in real estate is typically defined as acquiring a property or asset when its value is at its lowest point or close to it. This often occurs when a market is facing a downturn or recession.
The "Property Clock": You can visualize this using a concept called the "property clock." When the market is at its lowest (prices are down), the property clock hand points downwards, signifying a good time for countercyclical investors to enter.
Expectation of Upswing: The core idea is to buy at a low point and benefit from the subsequent appreciation as the market starts to recover. This can lead to significant investment gains.

Why Now Might Be a Smart Time to Buy

More negotiating room • Listings linger—averaging 50–60 days on market. Buyers can negotiate contingencies, price cuts, and seller concessions.
1. Higher mortgage rates peaked • Rates remain in the mid‑6% range, but heading lower than the 7% peak experienced in 2022–23
Economists say rates often dip during economic slowdowns .
Stable home values • Local brokers describe the market as “rebalancing”—not collapsing. Major crashes aren’t expected; slight corrections (~4–5%) are possible in overheated pockets.
Strong local fundamentals • Tampa’s job growth and migration remain solid, buoyed by business-friendly policies and quality of life.

Risks & Things to Watch

Insurance costs are high and rising: Florida premiums are among the highest in the U.S., affecting affordability and resale value .
Natural disaster exposure: Recent storms (Helene, Milton) caused regional damage, occasional price fluctuations in affected areas.
Uneven market segments: Luxury/lightfix homes still fetch strong prices, while mid-range properties see minor value dips.

Buying Strategy: Smart Moves for 2025

Prioritize neighborhood & condition
– Well-maintained, fairly priced homes in top school zones move faster and hold value.
Use your leverage
– With more inventory and motivated sellers, ask for inspections, flexibility on closing dates, and even rate buydowns.
Lock in mortgage rates now
– If rates ease later in 2025, reassess whether refinancing makes sense. But today’s mid-6% range.