Ya gotta have heart to buy real estate

    I bought a new Apple laptop computer six weeks ago.  Three weeks ago, the company announced that my model had been upgraded.  I'm happy with the laptop but not happy with the instant depreciation on it and missing out on a few improvements in the newer model (I would have paid the extra $100 happily).  Then this week, I come to find that software I bought six months ago has a new improved version.  No upgrade is available; if I want the better version, I need to pay another $49.
    I am not looking for sympathy.  On the contrary, I have a perfectly wonderful computer, and version 1 of the software will continue to suit my needs for years to come.  But the experience makes me think about those who bought property a few years ago for its investment potential rather than its best use, as shelter.  Those who bought a house to be a home at least have a roof over their head, even if their net worth has dropped; for most real estate investors, the floor has literally fallen away.
    Investing in residential real estate -- raw property or houses - is a dicey proposition in any market, even now in Miami or Vegas where it is tough to imagine prices could go any lower.  The stock market, over most periods of time, has been as good an investment as real estate, and certainly a lot more liquid.  You can peddle a stock on the downside in a matter of minutes, typically.  In Miami, the average wait to sell a condo is something like three years.  I admire anyone able to make money in real estate as I admire the 10% of horse players who come out ahead.
    In the spirit of full disclosure, I own three properties; I suppose that makes me look like a real estate investor.  Okay, as Woody Allen once said, "Guilty, with an explanation."  The first property is the home in which my wife and I have raised our children.  The second is a condo on the South Carolina coast bought as a vacation home nine years ago.  We use it for at least six weeks each year.  The third property is a lot, down the street from the condo, that we purchased -- gulp - at the height of the market two years ago with the intent to build in a few years.  
    Our timing could not have been worse, but we never considered the lot an investment in the strict sense; it was one of the last two properties directly on the golf course with views down the 16th fairway and out to the marsh beyond.  We either bought it then or risked never being able to have the house we wanted on the golf course in a southern community we love.  We had a lot more heart than head in the decision.  
    Woody Allen, again, once said that, "the heart wants what the heart wants."  You wouldn't think that emotion would trump the cold calculation of those investors who defied gravity and bought overpriced properties at the very top of the market.  But it did because, at the end of the day, you have as much as you started with.  Caveat emptor.