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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (49004)	1/8/2006 2:07:06 PM
From: Mike Johnston	Respond to of 110194

If you want to count housing inflation on the way up, you will have to count it on the way down My estimate of 6-10% true inflation rate does not include house prices, if it did the number would be in the teens. Consumer Price Index should reflect the cost of living thus it should include construction and upkeep costs of a new house but not the land component. That is because it is possible for land prices to increase in certain areas even with 0% inflation. Of course different people will have different perceptions of reality. If one lives in a warmer climate, works at or close to home, has purchased his residence 10-20 years ago, has his property taxes capped and doesn't have kids, will perceive inflation to be under control. On the other hand a first time homebuyer in 2005 might perceive the economy to be in hyperinflation.