The following is a recent conversation between Kirk Nace and Jeff Tumbarello.
Kirk: What are you investing to increase your knowledge? Time? Money? Are you striving to become more informed about your chosen filed or profession each and every day?
Jeff: I am sleeping 2 hours less a night and spending a ton of spreadsheet time, flipping the market every way I can. I understand the market just fine. I am more trying to understand the patterns of the market for days to come.
Kirk: If you study what happened yesterday and what is happening today, will it be of more or less value than thinking through what will happen tomorrow, understanding why and then positioning yourself accordingly? Jeff, the SWFL market is currently in the eye of the hurricane, there will be another 5 + years of down, increasing taxation will play a huge role in that. Once a bottom is reached (at around 1995 pricing levels, lower in some areas) it will be maintained for a decade or longer. You are a gifted analyst, are you seeing this in your spreadsheets, charts and numbers?
Jeff: I see a different trend line than you do. We are at 2002 pricing. Last year we were at 2001 pricing. SWFL popped first, which is our blessing. SWFL has a different set of demographic drivers than the rest of the country. We are the catcher's mitt in bad times. As the rest of the country joins the party we have been at for 3 years, we will appear a more attractive alternative. The big picture is bleak. When I look back for a historical trend line I see either the early 1970's; the social picture fits it more. Or the best timeline I see without many of the social correlations being 1925 land boom, 1927 land bust, 1929 stock market bust, 1932/1933 the world came apart. Most people think that the depression began on Black Friday. That started the chain of events...We will see.
Kirk: The recent bursting of the credit bubble started in the 1920's. One of the presentations I have been doing lately begins there, addresses the FL (and somewhat national) land boom/bust and brings things up to date clearly outlining where we will be going for the next 20 + years. No area is isolated any longer. Sovereign debt issues in Europe, S America and elsewhere have a direct impact on credit and rates globally which in turn impacts demand. I first shared with clients in October of 2004 that FL, AZ, NV and parts of S CA, etc would see a peek in prices within 6 to 12 months and then a correction of 35% or more. With each passing day I realize more and more how I underestimated the severity of this correction. It isn't about the real estate market, it's about accountability, living beyond our means, a sense of entitlement and no consideration for our choices or actions. You will see 1995 prices again, AND you will see attempts both here and abroad to inflate our way out of our debts. Those efforts will lead to revolutions, long overdue revolutions and from those revolutions we will see the seeds of a better future planted.
Jeff: FDR and his agenda was the primary driver of the elongation of the GD. All he needed to do was pick up the pieces and drive on. Instead he set about making this into a Socialist Country. His agenda alone made this debacle last longer than it should. We also have a faster downward velocity currently than then. That is the X factor. The next President will have FDR's timing. Obama came to town with FDR's plan and Hoover's timing. I guess when the brain trust that advises you, spent their college years on psychedelic drugs, I would not hold that against them. As to the future. I do not know...I take a defensive posture based upon the worst case outcome. I think in a worst case outcome we're approaching 1933, but with a whole lot more mouths to feed and a much larger government infrastructure armed to the teeth and committed to maintaining both distance and their "lifestyle". If you can't: Eat it, Take Shelter in it, Barter with it, Defend Yourself with it, Wear it for a purpose or Escape or Move in it...DO NOT BUY IT. I may be overreacting. I would rather be that fool to my children, than the other fool who did not plan for their future. I hope we have a good deal of non-violent upheaval and change. My children deserve a better world than this mess. If we as adults fail to take action, then shame on us!
Who is Jeff Tumbarello and why should we be concerned with what he thinks? Jeff as worked with the following media outlets as a subject matter expert.
General Real Estate, Real Estate Statistics, Real Estate Investing & Foreclosures for NPR, Bloomberg, Huffington Post, The Wall Street Journal, NBC, ABC, Wink, Fox, Fort Myers News Press, Naples Daily News, Fort Myers Weekly, and Gulf Coast Business Journal.
Jeff is the local expert and source of data for the current trends in foreclosures. He also has performed market metrics and product modeling for the capital markets and several private equity firms. He has been a Trainer & Speaker for the Florida Housing Coalition.
In 2003, Jeff and 3 other SWFL Real Estate Investors founded the South West Florida Real Estate Investment Association.
Jeff is a veteran of the USMC and served in Desert Shield and Desert Storm as an Infantryman with First Battalion Third Marines. He is from Stuart Florida and is blessed to be married to his beautiful wife Cristina and has 3 incredible children ages 8, 10, and 12.
