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- titan10
- Contributions:826
if someone is going to buy my house at an inflated price, I wont stop them. That is their own problem for being stupid. Would you sell your house for less than market if it was overvalued?? Not quite.
- Menudo Bongo
- Contributions:53
Love it. RE pros are praying for another bubble, so that they can sucker others to buy at inflated prices, and get their ill deserved inflated commissions.
- Connie Wildasinn, "Connie Wildasin"
- Contributions:1178
mid 2012 - we still need to get through the 5 year adjustables loans
- Terry Wenze, "TerryWenze"
- Contributions:20
Considering that real estate valuations are very local, there are some economic factors that I consider:
- Availability and terms of lending
- Local employment trends
- Population growth or decline
- Balance of housing inventory
- whipsawfx
- Contributions:124
..continued...
Looking at those numbers in themselves, you'd think that it may be a nice idea to start accumulating a few properties, stocks, other hard assets. But, hold your horses, this bear market has some way to go ... we've lost over a million jobs this year, the fastest and highest unemployment rate in some 25 years. Jobs are being shed twice as fast as the recent recessions in 1990 and 2001. It took over a year for jobs to stop falling in those recessions and I would imagine that we're a good 12-18 months away from seeing rises on the job front .. GDP has fallen by some 6.2% in the first quarter alone ... It looks bleak ... well until the next bubble. That being said, I think you can get good deals out there, and the way the fed is printing money you can be sure that if we don't fully escape deflationary pressures, there will be plenty of inflation for another bubble like period of growth in asset classes once we emerge from this mess.
Looking at those numbers in themselves, you'd think that it may be a nice idea to start accumulating a few properties, stocks, other hard assets. But, hold your horses, this bear market has some way to go ... we've lost over a million jobs this year, the fastest and highest unemployment rate in some 25 years. Jobs are being shed twice as fast as the recent recessions in 1990 and 2001. It took over a year for jobs to stop falling in those recessions and I would imagine that we're a good 12-18 months away from seeing rises on the job front .. GDP has fallen by some 6.2% in the first quarter alone ... It looks bleak ... well until the next bubble. That being said, I think you can get good deals out there, and the way the fed is printing money you can be sure that if we don't fully escape deflationary pressures, there will be plenty of inflation for another bubble like period of growth in asset classes once we emerge from this mess.
- whipsawfx
- Contributions:124
...continued ...
In the context of the charts frequently posted for the California bubble, property prices in California rose some 225% over the same time period during which the DJIA rose by 250% ... kind of odd that those numbers are so similar ... perhaps a little too similar for it to be a coincidence ... In anycase, there's clearly a link between the stock market and the RE market. Something which was probably bolstered by the Fed, Alan Greenspan and his monetary policy in the early 2000's, lowering interest rates to below market rate, to support the stock market. This invariably gave rise to the crappy crisis we're going through now ... Thanks Alan !!!
In anycase the annualised growth for Californian homes is just 6.3% at the current level, representing a appreciation of 127% in the over the last 14 years. Again right inline with what one may expect fundamentally .... so why is it a bubble ? Its not. You can put together an argument which would support the current RE market.
In the context of the charts frequently posted for the California bubble, property prices in California rose some 225% over the same time period during which the DJIA rose by 250% ... kind of odd that those numbers are so similar ... perhaps a little too similar for it to be a coincidence ... In anycase, there's clearly a link between the stock market and the RE market. Something which was probably bolstered by the Fed, Alan Greenspan and his monetary policy in the early 2000's, lowering interest rates to below market rate, to support the stock market. This invariably gave rise to the crappy crisis we're going through now ... Thanks Alan !!!
In anycase the annualised growth for Californian homes is just 6.3% at the current level, representing a appreciation of 127% in the over the last 14 years. Again right inline with what one may expect fundamentally .... so why is it a bubble ? Its not. You can put together an argument which would support the current RE market.
- whipsawfx
- Contributions:124
SPACE_ACER
Back in mid 2000...
"When is the tech stocks expected to turn around?"
I still dont expect Yahoo stock to go back to $350/share.
Do you ? You need to do some deep deep thinking!
Its you who needs to do some deep thinking ...
Sure Yahoo represents a good example of a tech bubble which blew a decade ago now ... The share price rose nearly 9000% in a little more than 3 years, the price has now declined some 85% from that meteoric high ... but at its low (last Decemeber) it had fallen a total of 91%. But in the context of its overall growth, Yahoo has grown at an annualised compounded rate of 20.4%. Now thats what I call growth. That 85% decline ... still a rise of 1017% over 13 years. If there's demand for something, or economic growth the asset will appreciate. The same goes for property values. But just like with stocks, or any other tradable asset, they overshoot on the upside, as they no doubt do on the downside. Just because there is a bubble like growth, doesn't mean that the asset has to lose all its value ...
An interesting comparison can be made with the growth of the DJIA. That has risen by some 250% during the 12 year period between 1995 and its peak in 2007. It has now declined some 50% from that peak, representing a growth of some 74% over the 14 year period from 1995 to today. How much should it have grown ? Well in that time period, inflation has risen by about 34%, whilst Real (excluding inflation) per capita GDP has risen some 33%, and the population has grown by some 15%, so fundamentally we are in the same ball park.
Back in mid 2000...
"When is the tech stocks expected to turn around?"
I still dont expect Yahoo stock to go back to $350/share.
Do you ? You need to do some deep deep thinking!
Its you who needs to do some deep thinking ...
Sure Yahoo represents a good example of a tech bubble which blew a decade ago now ... The share price rose nearly 9000% in a little more than 3 years, the price has now declined some 85% from that meteoric high ... but at its low (last Decemeber) it had fallen a total of 91%. But in the context of its overall growth, Yahoo has grown at an annualised compounded rate of 20.4%. Now thats what I call growth. That 85% decline ... still a rise of 1017% over 13 years. If there's demand for something, or economic growth the asset will appreciate. The same goes for property values. But just like with stocks, or any other tradable asset, they overshoot on the upside, as they no doubt do on the downside. Just because there is a bubble like growth, doesn't mean that the asset has to lose all its value ...
An interesting comparison can be made with the growth of the DJIA. That has risen by some 250% during the 12 year period between 1995 and its peak in 2007. It has now declined some 50% from that peak, representing a growth of some 74% over the 14 year period from 1995 to today. How much should it have grown ? Well in that time period, inflation has risen by about 34%, whilst Real (excluding inflation) per capita GDP has risen some 33%, and the population has grown by some 15%, so fundamentally we are in the same ball park.
- titan10
- Contributions:826
I have been told that is part of the tarp funds to artificially keep bonds yeild rates low, pushing mortgage rates lower. I dont understand it that well, but that is what I was told by a mortgage broker and the rates supposedly going down to 4.5.
- Pasadenan
- Contributions:21365
Government buys its own bonds? What are you talking about? All the bond distribution I've looked at shows something substantually different, with the Chinese buying the majority of the U.S. Government Bonds presently. What good is it to sell a bond if it brings in no money from any other sources?
Are you just trying to get us to bust up laughing?
Are you just trying to get us to bust up laughing?
- titan10
- Contributions:826
I believe your right about the bonds. The government buys their own to force prices up and yeilds down. As soon as that stops, and inflation rears it head, yeild will go up big time, and prices will drop to the floor.
- space_acer
- Contributions:4311
Yes... the bubble did turn around and is on the way down...
Back in mid 2000...
"When is the tech stocks expected to turn around?"
I still dont expect Yahoo stock to go back to $350/share.
Do you ? You need to do some deep deep thinking!
- Pasadenan
- Contributions:21365
I said in the 70's that I would sell at peak too; only trouble is, even though I knew when the peak was, I had too many things going on and too much stuff in the way to even think about selling and moving at the time.
And in 2000, I had an excelent opportunity to buy with leverage, and more than double the value of the property in a few years. Yes, it was obvious, but I was not in a position to take a risk on not being able to make the payments, nor the potential vandalism if it was not my primary residence.
Opportunity comes around regularly; (may not be housing, there are plenty of other sectors), it doesn't mean we see, nor that we will be prepared to do something about it.
And in 2000, I had an excelent opportunity to buy with leverage, and more than double the value of the property in a few years. Yes, it was obvious, but I was not in a position to take a risk on not being able to make the payments, nor the potential vandalism if it was not my primary residence.
Opportunity comes around regularly; (may not be housing, there are plenty of other sectors), it doesn't mean we see, nor that we will be prepared to do something about it.
- Pasadenan
- Contributions:21365
They said on the public radio today that the next bubble is government bonds. As soon as better interest rates are offered elsewhere, the bonds will take a dive, just like housing.
- titan10
- Contributions:826
I want another bubble. Ill make a sh**load when I sell.
- Menudo Bongo
- Contributions:53
Well, the question seems to beg for another bubble.
Why do you want another bubble ?
In an ideal society/economy, valuations should be justifiable by the economic activity - I wish bubbles could be wished away forever, and everybody would pay a fair price for everything !!!
Why do you want another bubble ?
In an ideal society/economy, valuations should be justifiable by the economic activity - I wish bubbles could be wished away forever, and everybody would pay a fair price for everything !!!
- HomeSand.net, "White Picture"
- Contributions:4381
"The people that bought at bubble prices in 1928 never saw a return on their investment losses either."
Any of them alive to day ??? :-)
Any of them alive to day ??? :-)
- titan10
- Contributions:826
it took 13 years from one bubble to another in california. People are sheep, and will forget soon. Once the crap falls off the credit, it will start again.
They will remember the money made on the way up, not lost on the way down.
40 years is not realistic
- turn
- Contributions:23
If only we had a crystal ball!
By reading Zillow and doing other research, it appears the rest of 2009 will be rough. However, I have also learned the some areas of the US are in much better shape than others. My area is not dependent on nearly as many industrial/factory jobs and the forclosure rate is well below national average.
The vast majority of good buys are under $350 which doesn't get you much, some up to $600 OR $1.2 and up. For the average buyer there really are few prices to get excited about.
By reading Zillow and doing other research, it appears the rest of 2009 will be rough. However, I have also learned the some areas of the US are in much better shape than others. My area is not dependent on nearly as many industrial/factory jobs and the forclosure rate is well below national average.
The vast majority of good buys are under $350 which doesn't get you much, some up to $600 OR $1.2 and up. For the average buyer there really are few prices to get excited about.
I meant.... "Great now I have to start worrying that my Grandchildren will blow it all!!!!!"
Want to know when we will have a "simular" bubble in housing prices? It will be at least 40 years. People have to forget first, before they will allow such lax lending standards again.
Great now I have to start worring that my Grandchildren!!!! Thanks Pasa ;-)
Great now I have to start worring that my Grandchildren!!!! Thanks Pasa ;-)
- Pasadenan
- Contributions:21365
In most areas, the "bubble" "turned around" somewhere between 2005 and 2007, meaning it is no longer "bubbling", it is "deflating". It will continue to deflate until fully deflated, meaning somewhat below the inflation line from 10 years ago. Better figure about 1.5% inflation for the next several years instead of the typcial 7% annual inflation though.
Want to know when we will have a "simular" bubble in housing prices? It will be at least 40 years. People have to forget first, before they will allow such lax lending standards again.
The people that bought at bubble prices in 1928 never saw a return on their investment losses either.
Want to know when we will have a "simular" bubble in housing prices? It will be at least 40 years. People have to forget first, before they will allow such lax lending standards again.
The people that bought at bubble prices in 1928 never saw a return on their investment losses either.
- titan10
- Contributions:826
Its already over. Obama is in office...
The economy has returned, the world has cooled to normal levels, the tide has receeded, ice caps have returned to normal, and there is peace in the middle east.
- Michael Emery, "MikeEmery"
- Contributions:7275
I heard it's going to be a week from Tuesday. Right after Oprah.
- Sarah Maus, "SarahMaus"
- Contributions:47
Take a look at this article
http://www.floridarealtors.org/NewsAndEvents/n5-030309.cfm
and see if it can shed some light on the situation for you...
- LyndieQ
- Contributions:236
The bubble burst and is now merely molecules floating in the atmosphere or in the dirt. It was an unprecedented bubble and we'll never see the likes of it again in our lifetimes. How can a nonexistent bubble "turn around"? It's going, going, gone and any owners with overpriced houses out there only have bubbles in their heads. (not to say there still aren't plenty of innocents getting duped into the "it's a buyer's market" line.)
- workabee
- Contributions:1030
When people are employed and houses are more affordable.
- Kathleen Wilson, "Kathleen Realtor"
- Contributions:12
When Americans start buying American made products (like Cars) our economy will improve. Ahem. There were expected 40,000 foreclosures this year and 10,000 next year. That will be the end of it and things will get better soon after. This is just the way I see it.
- FriendshipProperties
- Contributions:783
When Bank REOs and Short Sales are less than 30% of the homes for sale. In other words, when all the 'bad' loans have been fixed or foreclosed.
- jamhie
- Contributions:42
housing price will continue to drop till 2011 or so.
this is why when submitting an offer to buy an house, it should always been % - 30% below the asking price.
I have seem lots of houses drop from $250k to $150k in just 18month in the market.
this is why when submitting an offer to buy an house, it should always been % - 30% below the asking price.
I have seem lots of houses drop from $250k to $150k in just 18month in the market.
When is the housing bubble expected to turn around?
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