[quote=bewildering]
I think Rich believes that the 2013 gains were not unreasonable in relation to rents, or income. Just a return to a normal market because few short sales/foreclosures. At least that is my reading of this blog.[/quote]
I don’t think I’d characterize it that way… 2013 saw prices go up quite dramatically in comparison to incomes/rents. I push back on the idea that it’s a “bubble” (fwiw with such a squishy term), or that it’s anything like what it was during the mid-2000s bubble. But, homes are substantially more expensive than has been historically typical, and most of that happened in 2013.
BTW, they went up in 2012, but that was mostly just going from “somewhat cheap” to “reasonable”… so I would say 2012 was the reversal of a” post-bubble overcorrection,” to use jazzman’s apt phrasing. But 2013… that was a different story.
In fact let me put some numbers on it, for giggles. This is using my little valuation index thinger, and comparing it with the historical median valuation:
Dec 2011: 8% undervalued
Dec 2012: 2% undervalued
Dec 2013: 13% overvalued
(Haven’t done the 2014 numbers yet… it’s on my list 😉
(but, I suspect that 2014 saw the valuation go up another few %… creeping a little higher but nothing like the 2013 frenzy)
