I have commented on this before and will do it again. If you are looking for a price point that fits your budget, then picking a number and looking for it, is the way to go.
Make no mistake though, the price at which we bottom out (anywhere including my home base of Scripps) will have nothing to do with my budget, or any of your budgets. It will not have to do with 2001, 2002, or 1999. It will have to do with indicators such as volume, such as foreclosures, such as interest rates, active/pending ratios, etc…These indicators will tell you where we are in the depreciation cycle. The median price of the home you want at the time when those indicators are signaling that the depreciation cycle is slowing down may or may not have reached your personal threshold. You guys see what I am saying? These other metrics will help you make sure you didn’t go in to early and that maybe you don’t miss the bottom either.
Now the only thing that I worry about is a false bottom. That is, in 2009,2010, or 2011 we MAY indeed see alot of these indicators signal a significant move such that the depreciation cycle may appear to be ending. However the second wave of resets for prime properties or something of that nature may then come in and who knows, maybe we have another shot downward after a year or two of calm. This may be paranoia on my part. I don’t know…. I just cringe every time I read people saying things like, “what price point do you think is the bottom, or where would you buy at?”
Finally, this afternoon I saw a black car driving up I15 with a license plate that said sd bear!
