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

To: Live2Sail who wrote (204709)	5/28/2009 2:06:35 AM
From: Skeeter Bug	Respond to of 306849

L2S, i've been wrong before, but i can't fathom a scenario where we bottom by august of this year. housing is still well above the 1989 bubble, and that took 5 years to bottom. the economy is collapsing and interest rates are spiking up, both of which will collapse housing by itself. i'm thinking 2012-2014.

To: Live2Sail who wrote (204709)	5/28/2009 7:59:18 AM
From: Think4Yourself	Read Replies (1) \| Respond to of 306849

"The inventory for 700k homes in Palo Alto is probably 1 month." Serious question: What would you expect to happen to that inventory if Prop 13 is repealed? Would there be any impact at that level?

To: Live2Sail who wrote (204709)	5/28/2009 8:39:46 AM
From: MulhollandDrive	Respond to of 306849

you're missing the point, l2s....which wasn't TOLL the point is that nationally homes over $700k have a FORTY MONTH supply... now i realize that $700k is a starter home in your area, (btw, the news was about $700k home and ABOVE) the question you need to ask the fundamental question as to why....and the answers are obvious.... unqualified buyers under the new (or shall we say "old" as in normal loan qualifications for a loan that large.... 20% down, supported by income) iow, "it's the borrower, stupid" (i've been saying this for months) which is supported by the fact that even though lending requirements have eased somewhat, banks are saying there is still contraction on the DEMAND side so you have tighter loan requirements and borrowers who are unable or unwilling to get those loans i don't think there's a snowballs chance in hell we show growth by august (did you see the TNX yesterday???) put a fork into any nascent housing 'recovery' with a spike in interest rates the problem with housing as a safe investment in an inflationary environment is that we already HAD the asset INFLATION in housing and that bubble has burst....if the fed can reflate that bubble i think it will be the first time in history (i'm sure someone will correct me if i'm wrong) until we see wage inflation (did you see continuing claims this morning? good luck with that) we will not see housing inflation, median home price is now about $170k (still slightly above 3x median income) the buyers who were able to s-t-r-e-t-c-h into the $700k market have evaporated under today's new normal....supply will continue to grow (palo alto notwithstanding<g>) which means prices will continue to contract