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

To: MulhollandDrive who wrote (17964)	2/29/2004 4:59:41 AM
From: Elroy Jetson	Read Replies (1) \| Respond to of 306849

Thanks for the audio link, he has some good ideas. I skimmed through his book, "How to Profit From the Coming Real Estate Bust" a few months ago when friend purchased it. The only aspect of his book I didn't like is where he compared real estate prices with the CPI. In order to make sense of real estate prices you need to understand that in the long term, real estate prices are always a function of Income not general price levels. Here is a chart from a report I wrote in 1987 comparing the Los Angeles County Same Home Price from 1900 to 1987 with: Los Angeles County Construction Costs since 1915; Personal Disposable Income since 1929; CPI Rent Index since 1913. home.pacbell.net You can see how the slope of home prices matches with Personal Disposable Income. The chart reflects the more primitive graphics of 1987. I added some notes to the legend to help, but you still need to expand the image fully to see it clearly. The same home index is created by the Real Estate Research Council of Southern California. They are a group of leading appraisers and Cal State Pomona who, since 1896, have taken a sample of homes which they appraise every six months. Although the sample of homes has slowly changed over the years, they made every effort to make the index represent a single group of homes which remain the same age and quality over time. It is the longest trustworthy time index of home prices in America. Their website lists the membership responsible for the project. csupomona.edu I'd add the latest data except for the fact I haven't had a need compelling enough to buy a $450 membership lately.