The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: CalculatedRisk who wrote (28203)	3/16/2005 7:40:58 AM
From: Wyätt Gwyön	Read Replies (3) of 306849

CR, thanks for that excellent analysis. one interesting thing is that while it took 6 yrs for the market to bottom, it only took 3 yrs, i.e. half the decline time, to make it back to breakeven (in nominal terms). this is the opposite of what one hears about the stock market--that declines are faster than rises because "fear is more powerful than greed". regardless of whether that hoary maxim about "the market" is true, there do seem to be some peculiarities about the RE market, as you noted, in terms of its being "sticky downward". perhaps another reason for this "property" of the RE market is the tendency for people to be in denial about the existence of a down market, combined with the liquidity dry-up. since so many people are employed in RE these days, i must wonder if the lack of liquidity will itself be a major contributor to the crash at some point. is RE now California's most important "industry"? btw, CR, do you know if those CPI figures you used to get the 26% real decline include food and energy?

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