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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: SouthFloridaGuy who wrote (224873)10/14/2009 9:45:55 PM
From: CalculatedRiskRead Replies (2) of 306849
 
Yes, I posted that low end was probably at a price bottom last year - but not the high end.

Be careful though ... many low end areas have seen a recent price boom because of market distortions:

* demand stimulated by first-time home buyer tax credit and FHA making bad loans

* supply constricted by trial modifications

So the price in those areas has gone up. As I noted some time ago ... "duh". Supply and demand.

But the demand from the world's dumbest tax credit will wane - even though it will be extended (see clunkers tax credit) - and the banks have already said there will be a "spike in foreclosures" later this year. So be prepared ...

Note: Replacement costs matter if there is demand (exhibit: Detroit)

best wishes
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