Do you suppose 1990 bubble prices in Japan are still considered the “regular price” or the point at which discounts begin?
Today, would a Japanese buyer be tempted by a realtor stating the house was 50% off what it sold for in 1990? Or would that 1990 number be considered an absurd anomaly today?
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Feel free to wait that long. I have exceedingly serious doubts they would come anywhere close to falling that far. For one thing, for prices to fall that far, income would likely have to be cut by 30% over the next 8 years – otherwise price to income ratios would be in the 1.5:1 range, which would be historically unprecedented (median house price in 1988 was $145K).
Of course, inflation adjusted, it won’t be surprising at all to see that – but an inflation adjusted 1988 price is 260K – not far off where we are now.
In current 2009 dollars though? I just don’t see it.
