[quote=patientrenter]Prices at the peak (in areas that were developed in 1996 so we can compare prices now to prices then) were about 4-5 times higher than back in 1996. So a drop of 25% from the peak – a global residential real estate peak that was unprecedented in recorded history – is peanuts.
If the price decreases at the high end continue on their normal, natural course to a cyclical low, then the federal govt will come up with a new way to funnel more money into the high end. I don’t expect prices to be allowed to get anywhere close to their natural economic level at the bottom of a RE cycle, either at the low end of the market or at the high end.[/quote]
Perhaps it’s time for you to come up with a new moniker.
In any case, if 25% of a million and a half is peanuts to you, sounds like you don’t have to worry about it. It’s certainly not peanuts to me. Maybe 25% is peanuts compared to what it went up. But it’s still not peanuts to me.
I don’t hold the same faith in the government’s ability to hold up prices as you do. The government wasn’t able to stop the low end from dropping over 50%. If the high end drops that much (I doubt it will, but not because of government intervention), then we’ve moved even further away from “peanuts.” Perhaps prices won’t drop all the way to their natural economic level, but, if the article is correct and the declines accelerate henceforth, we should see some significant (as opposed to peanuts) peak-to-trough declines.
