I rely on data to make my predictions. I extrapolate from history and current data to make my predictions.
A statement that many ARM borrowers can afford their products because their incomes will rise 50% should be easy to verify.
The sales decline are based on MLS data. Sales are falling by 10 points every quarter, so I am extrapolating. -10% Q1, -20% Q2, -30%Q3. I estimate -40%Q4, but we won’t know until it happens.
Likewise, home price deline is an extrapolation of past trends. I saw -5% by last winter, and now in summer we are hearing stories of 2004 prices, so that’s -15% in some cases. I extrapolate to get -20% by end of year. Again, time will tell if this is correct.
Anecdotes are very important, because as we know, the median is often 2 years lagging. Even the Federal Reserve relies on anecdotes for some of their analysis.
sakina96, let’s really try to analyze how many people would fall into the category of rising wages, because it helps us all to predict better the future of the market. What do you think is the impact of ARMs, both in data and in your own experience.
