Going public: A sign of market health?
You may not know it, but one of the largest real estate franchises in the county went public this week. RE/Max, after 40 years as a private company, had its IPO this past Wednesday and performed well in its debut.
Other recent high-profile real estate IPOs are Realogy, Trulia and Zillow in the last 18 months. So is this the sign of a real estate recovery – of overall market health?
In my opinion, most of these offerings would have happened much sooner without the impact of the downturn. The prolonged downswing, however, created a situation where expectations were diminished (Facebook, anyone?) and the time was ripe to go public. The fact that so many major entities have done so, and so recently, leads one to the conclusion that these folks think that the next thing is a period of prolonged market growth. Certainly, many areas around the country ARE experiencing significant growth (increased prices, decreased inventory).
This would seem to be “that moment” before the next run-up, and with all these companies cashing in on public speculation I think it’s safe to conclude that the real estate market is on the move.