This is a very good thread. No we are not even close to the bottom. In fact given the current goals of this administration I am seriously reconsidering my estimates on this depreciation cycle altogether. Originally I used to be in the 2010-2011 camp. This year I have moved out a year or two. Now I do believe we will see a much more uneven depreciation cycle. Not only is it defined by serious fragmention based on housing type and zip codes, but now I feel as if we will see a much more schizophrenic behavior with bouts of cyclical rallies that result in subsidies more then market strength. This spring is the posterchild for the first one.
I cannot overemphasize the strength of the current activity. It borders on being laughable. There is not any fundamental foundation for this sort of behavior. Nothing looks good from the economic and employment front, foreclosures are not abating (at least not naturally) and there is only a concerted effort by our government to increase home values.
Note the effort is not to build a healthy housing market. The effort is not to make sure that buyers are qualified to own homes. The effort is to try to raise values by adding incentives such as low rates and tax incentives to thus stimulate buying. Additional constraints such as stemming inventory by raining tax dollars all over distressed homeowners and creating obstacles to foreclosure.
