Who predicted the real estate crash? Actually, there were a lot of smart money managers predicting the recession due to fundamental realities in the market. Now we are looking for the signs of recovery, who is predicting the housing market recovery and growth? It is hard to find those hard hitting optimistic talking head these days. One must look a little deeper to find the optimism. Have you heard the phrase, actions speak louder than words... look who is buying real estate... Here is an excerpt from a recent WSJ piece on John Paulson.
A Bullish Sign for New York Real Estate?
Hedge fund manager John Paulson, who successfully predicted when the housing bubble would burst, has purchased a two-bedroom apartment in a luxury condominium on New York’s Fifth Avenue, across from Rockefeller Center and St. Patrick’s Cathedral.
Paulson paid $2.85 million, 23 percent below the $3.7 million listing price in July 2009.
The fund Paulson manages had about $2 billion under management in 2005 when it bet against the housing bubble by purchasing derivatives that provided protection from falling home prices. In 2007, the firm made $15 billion from this strategy.
Source: The Wall Street Journal, Craig Karmin (11/20/2010)
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