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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: David Jones who wrote (27458)2/24/2005 9:22:34 PM
From: Amy JRead Replies (3) of 306849
 
RE: "Realize that article was wrote May of 02 directed at builders and during a time when talk of deflation was prevalent. So I see him as a bull in calling for real estate to trend off after 04."

I didn't realize it was written in May 2002.

RE: " In time when other vehicles for investment start to shine those holding low CAP properties will rotate out"

Thanks David for your post. What is a CAP?

Given demographics and current house prices, I would predict local housing prices decline as interest rates increase, followed by flat prices for a decade. Wouldn't be surprise to see luxury decline even more than what they already are starting to do right now before they might go flat for a decade. I think initially we will see a smaller decline in entry level (demand is higher at the entry level than luxury).

But a lot of people are living in a smaller place than what they want to be, but like Suma said, many people can't move. So, after a decade of flat prices, we eventually could see luxury uptick first as people move up. But by then, it's equally possible the boomers could begin one of the largest Demographic trends in American history - the great wave of retirees, putting downward pressure on luxury homes as people downsize. But here's a thought: what are the odds boomers surprise all of us and keep working past the normal retirement age? Demographically speaking, boomers have a great reputation for working hard and enjoying work.

Regards,
Amy J
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