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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: 8bits who wrote (8810)	2/10/2003 4:35:09 PM
From: Elroy Jetson	Respond to of 306849

Real estate value is very specific to each geographic region. But in rough numbers you can compare national GDP (non-inflation adjusted) to real estate prices in your area. You can get fancier and compare regionalized GDP to your regional prices. As an example, since 1996, the BLS claims GDP has increased 36.2% while the "Real Estate Research Council" claims Southern California homes have appreciated 61.1%, or 18.2% over-valued, and Northern California homes have appreciated 92.3%, or 41.2% over-valued. I chose 1996 as the beginning as that's where the long term lines of localized GDP and Southern California home prices since 1895, once again, fall into parity. You can choose different starting points etc, but in the end it's like valuing stocks - it doesn't help your financial well-being to convince yourself of the correctness of unrealistic valuations. Here are the US, start of year, GDP numbers. Compare them to real estate prices in your region. 1990____5720.8 1991____5886.3 1992____6183.6 1993____6521.6 1994____6887.8 1995____7297.5 1996____7629.6 1997____8124.2 1998____8627.8 1999____9092.7 2000____9649.5 2001___10028.1 2002___10313.1 2003___10389.0