PS I would have to agree with you as well. I think 07 and 08 will see equivalent or more drops then we have seen here in 06.
However I am still somewhat bothered by the fact that at “some point” prior to the 50% drop, there will be a positive cash flow potential for investors due to higher rental costs. Doesn’t it seem logical to think that? Say there is a home that is 500k but can return 7% assuming you put 20% down once it gets to 320k. Assume this rate also was valid after your property tax and other fees to maintain the property. Wouldn’t an astute person start to buy properties at that point? Even with the bottom still not reached, you still have shook out more of the risk and now have more upside so while most people would say I am gonna wait, some will not and they will park the money and take the 7%. Yes they will experience some depreciation but the lionshare will have been digested already.
So again, I think some zip codes could have maybe even MORE then 50% depreciation but others will not.
Also I do believe some zips this year have already seen as much as 20% depending on location and housing type.
