- This topic has 6 replies, 5 voices, and was last updated 18 years, 8 months ago by Wickedheart.
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February 3, 2006 at 2:55 PM #6357February 3, 2006 at 3:19 PM #23392San DiegoParticipant
The last bust happened when Interest Rates were in double digits and their were huge jobs losses because of a decrease in military spending.
What is your definition of a “reasonable entry point”? If someone bought a SFR in Carmel Valley for $500,000 in 1998 and recently had it on the market for $1.3 million but ends up selling it for $990,000, is that a “reasonable entry point”?
February 3, 2006 at 3:47 PM #23393RightSideParticipantActually, nominal interest rates were in double digits, but I don’t beleive real interest rates were that different then they are today. (Quck econ lesson, if inflation is 10% and the nominal interest is 12%, then real interest rates are 2%)
In any case, my question was regarding the characteristics and time duration of the last couple of busts. How long did prices take to from point a down to point b once the uptrend stalled? (Anyone know where this data might be available?)
My defination of a reasonable entry point is not based on price action, but on relative price to median income. Rich has some great charts showing how houses are currently trading at 15x median income, when the historic average has been around 8. When prices get closer to that reality, then I think they will be more sustainable and thus reasonable.
-Michael
February 3, 2006 at 4:21 PM #23395teatsonabullParticipantReasonable entry point is about 50-55% of the highest price the house sold for here in San Diego during this frenzy.
Impossible you say! Well, this is where we were a mere 4-5 years ago before this phony “expansion” really hit it’s stride.
February 4, 2006 at 1:44 PM #23401WickedheartParticipantZip Realty lists inventory and days on the market. You can also see the price reductions on homes, very enlightening. It’s been quite an eye opener for me. I’ve been tracking the 92123 zipcode and I see many properties with multiple reductions.
February 7, 2006 at 8:26 AM #23409lewmanParticipantPast housing price data can be found on the Chicago Mercantile Exchange. It goes back to the 70s so you can get a feel of what happened through several cycles in the past.
February 7, 2006 at 12:25 PM #23410WickedheartParticipantNo, I’ve only seen the days on market for individual listings. Sorry I can’t help.
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