[quote=poorgradstudent]We must be near a bottom in the housing market….[/quote]
poor grad student, real estate is cyclical, and the long term values track real nominal consumer prices / wages quite well.
So check the last RE cycle trough. When was it? What what were the prices then? Adjust those prices upwards for increases in nominal CPI or wages.
Now compare those prices to today’s prices. I think prices in SD in general are still higher than they were at the last cycle trough, with some exceptions.
Perhaps this trough will be naturally shallower because the prior boom was not as big? If you go to the trouble to find a chart of the Case-Shiller home price index for SD, you’ll see as plain as day that the boom that precedes this downturn was the biggest on record, by a wide margin. The only way the trough won’t go deeper than the 1996 trough is if the govt intervenes massively. They are, but how much can it overcome natural economic forces?
I would be very careful before drawing quick conclusions that we’ve reached a bottom.
