I’m predicting a 45-50% drop too but I can’t say how exactly it will play out, whether it will happen in 3yrs or 10yrs, that is the tricky part. My personal feeling is that the exotic/subprime reset in 2007 and 2008 will depress prices in one huge go and revert them back to 2002 levels. 2008 4Q we should see at least a 30% drop since I don’t see any sufficient demand with the absence of speculation or exotic lending.

Interest rates are going up, the fed is already concerned that CPI is trending in the wrong direction (i.e. up!!), I suspect that late 2007 they may have to jack up rates again, this is additional fuel to the fire for all the resetting ARMs.

I feel we cannot use history as a guage because we have had a rise in values that has never occured on this scale in history. I predict the downfall is also going to be one of a kind.

We may also enter a deflationary spiral aka Japan, why not?

Yes, we are definitely in uncharted waters. Who knows what the future will hold.

My only ‘prediction’ that I’m reasonably comfortable with is that 2007 will be the year the bubble ‘pops’ and public perceptions shifts. How many years it takes for all this to unwind is anybodies guess.

If history is any gauge, then there will likely be big losses in a short time frame (typical crash), followed by a slowing downward trend as the more rational folks return to the market. There are alot of renters on the sidelines with money in the bank, remember!

Just won’t give up there will you raybyrnes? Good, you keep on spouting that nonsense right into the downturn you moron and I will be laughing at you all the way…

Thanks 4plexOwner for your information. I had wondered how the 40 year mortgages were going to slow this dripping iceberg from complete meltdown. I can see that the payment difference isn’t really that substantial. Tell me, Japan really had 100 year mortgages? Crazy! Certainly didn’t ameliorate, shorten or stop their crash. Facts are good! Knowledge is power!

Thanks so much! DaisyD

My guess is 40-50% off of summer 2005 prices in 2010 + or – one year.

My prediction is 50% drop from 2005 price in san Diego. Some areas are still appreciating , like LA. According to the last housing market cycle: It peaked in 1989 and the bottom was in 1996. So, it took 7 years to hit the bottom. This time the hosue maket peaked in 2005, so the bottom may in 2012. However, we may see around 25-30% price drop by next year, 2008. Then, it will drop slowly to hit the bottom by 2012.

There is little difference between starter of this thread and the speculators of CA real estate market. I would not expect huge drops in real estate especially in good family neighborhoods. There is little incentive for the lenders, real estate industry and others to commoditize the business. The only thing to produce huge drops would be massive job lossses. I would expect significant number of folks reading this message board to be out of work. The most important thing is that do not expect big increases in real estate property values for the next 20-30 years.