[quote=davelj][quote=CA renter]No, but the dollar amount lost per house is probably greater on the higher end than on the lower end. Yes, there will be fewer houses in distress on the higher end because people were moving up with significant down payments from sales on the lower end, but I’m not sure how much of this equity is still left.
Also, I think we were more than halfway there in late 2008 as things were really beginning to accelerate, but with all the intervention since then, I think we’ve actually gone backward, and now have more unwinding to do (all over again). You’ll bring up the point that unwinding has taken place since late 2008, and you’re right. It’s just difficult to quantify how much benefit was gained vs. the additional burden that was added during the period from late 2008-present.[/quote]
So what exactly does the “halfway” apply to? Percentage? Timing? High-end alone? I’m just trying to get a clear idea of what you’re applying “halfway” to.[/quote]
Good question. In a way, it’s all the above. IMHO, we were halfway there because the bottom half of the housing market was getting very near to “normal,” but the top half still needed to adjust accordingly (so, ~half of the housing stock was pretty near corrected…halfway there). The intervention that happened after the lower half fell prevented the needed correction in the top half, which I think was simply delayed, not “prevented from falling.”
If things were allowed to correct without govt interference, I think we were about halfway through the correction, timing-wise, in late 2008/early 2009 (which was faster than I had originally anticipated, but was always wary of govt interference that would prolong the recession).
I think we were near halfway through the correction in total dollar losses, too, as the higher end would lose more per house, but there were probably fewer houses in distress.
