BusinessWeek: Why housing could fall 25%

[jpinpb]

I have some family in Italy. They own their own homes. Generally passed down through the family. They never sell.

I don’t own a home for the very reason that I could not afford one. I hope to one day afford one. I don’t have much of a choice but wait, save, limit my debt, hope prices come down to something reasonable, hope I don’t have to move out of state.

I already missed the no money down, interest only train. It made no sense. I was pressure by friends, family, realtors, and lenders. I did not want to gamble w/an interest rate that could change, even when they said I could always refinance, I kept thinking whatifs, if there is pre-payment penalty, if the value comes down even 5%, etc.

When the subprime mess hit the fan, I felt like I did the right thing. But now government coming to the rescue, I feel like I was punished for doing the right thing.

I do agree w/you that a correction is in order. Just b/c I think that or you think that, doesn’t mean it’s going to happen. I know it’s not in the Declaration that people are entitled to afford a house, but it’s nice after working hard, you can come home and say, “I’m working hard for this. It’ll be mine.” I mean, ever since people came to America, the pioneers bought land, built their cabins. It just seems like a reward for all the hard work.

I’ve owned a house before and it is a good feeling, something tangible. And I’m not even a consumer or materialistic at all. I don’t give into that. Yet, something about having your own place, though.

[NotCranky]

One comment I have seen on this blog often is that houses will alway correct beyond the trendline. Thes graph that robson posted above seems to prove that. However, there are a few examples of it taking 20 years to do so and after many up and down movements in which inflation adjusted price did not go below the trend line. I am talking about the periods from 1890 to 1918 and 1945 to 1965.The last two cycles follow the immediate overcorrection idea. Obviously, there is currently room for a huge correction regardless of crossing or not crossing the trendline.

[NotCranky]

One comment I have seen on this blog often is that houses will alway correct beyond the trendline. Thes graph that robson posted above seems to prove that. However, there are a few examples of it taking 20 years to do so and after many up and down movements in which inflation adjusted price did not go below the trend line. I am talking about the periods from 1890 to 1918 and 1945 to 1965.The last two cycles follow the immediate overcorrection idea. Obviously, there is currently room for a huge correction regardless of crossing or not crossing the trendline.

[NotCranky]

One comment I have seen on this blog often is that houses will alway correct beyond the trendline. Thes graph that robson posted above seems to prove that. However, there are a few examples of it taking 20 years to do so and after many up and down movements in which inflation adjusted price did not go below the trend line. I am talking about the periods from 1890 to 1918 and 1945 to 1965.The last two cycles follow the immediate overcorrection idea. Obviously, there is currently room for a huge correction regardless of crossing or not crossing the trendline.

[NotCranky]

One comment I have seen on this blog often is that houses will alway correct beyond the trendline. Thes graph that robson posted above seems to prove that. However, there are a few examples of it taking 20 years to do so and after many up and down movements in which inflation adjusted price did not go below the trend line. I am talking about the periods from 1890 to 1918 and 1945 to 1965.The last two cycles follow the immediate overcorrection idea. Obviously, there is currently room for a huge correction regardless of crossing or not crossing the trendline.

[NotCranky]

One comment I have seen on this blog often is that houses will alway correct beyond the trendline. Thes graph that robson posted above seems to prove that. However, there are a few examples of it taking 20 years to do so and after many up and down movements in which inflation adjusted price did not go below the trend line. I am talking about the periods from 1890 to 1918 and 1945 to 1965.The last two cycles follow the immediate overcorrection idea. Obviously, there is currently room for a huge correction regardless of crossing or not crossing the trendline.

[NotCranky]

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[NotCranky]

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[denverite]

I thought there was a significant qoute in the article.

“”I know you’re not supposed to say I told you so,’ but I’m at the age where I can do it: Homeownership was oversold,” says 67-year-old House Finance Committee Chairman Barney Frank (D-Mass.). ”

What, a powerful liberal Democrat, conceding this? … perhaps we won’t be subsidizing the RE bubble after all.

On a slightly different note, the News Hour held a town hall metting that consisted of San Diego bankers, mortgage brokers, realtors, speculators, counselors, and a few home owner/foreclosed individuals. I was disappointed when Gwen Ifill (softball on all subjects) provided the moderator role, but did catch the last 2/3’s of the segment. No one even mentioned the home valuation as the problem. A Pigg point of view should have been there to straighten them out. They really danced anround anything of substance, however, one participant did say that he was starting to see some PANIC in SD. I hope this is a portent of things to come.

[denverite]

I thought there was a significant qoute in the article.

“”I know you’re not supposed to say I told you so,’ but I’m at the age where I can do it: Homeownership was oversold,” says 67-year-old House Finance Committee Chairman Barney Frank (D-Mass.). ”

What, a powerful liberal Democrat, conceding this? … perhaps we won’t be subsidizing the RE bubble after all.

On a slightly different note, the News Hour held a town hall metting that consisted of San Diego bankers, mortgage brokers, realtors, speculators, counselors, and a few home owner/foreclosed individuals. I was disappointed when Gwen Ifill (softball on all subjects) provided the moderator role, but did catch the last 2/3’s of the segment. No one even mentioned the home valuation as the problem. A Pigg point of view should have been there to straighten them out. They really danced anround anything of substance, however, one participant did say that he was starting to see some PANIC in SD. I hope this is a portent of things to come.

[denverite]

I thought there was a significant qoute in the article.

“”I know you’re not supposed to say I told you so,’ but I’m at the age where I can do it: Homeownership was oversold,” says 67-year-old House Finance Committee Chairman Barney Frank (D-Mass.). ”

What, a powerful liberal Democrat, conceding this? … perhaps we won’t be subsidizing the RE bubble after all.

On a slightly different note, the News Hour held a town hall metting that consisted of San Diego bankers, mortgage brokers, realtors, speculators, counselors, and a few home owner/foreclosed individuals. I was disappointed when Gwen Ifill (softball on all subjects) provided the moderator role, but did catch the last 2/3’s of the segment. No one even mentioned the home valuation as the problem. A Pigg point of view should have been there to straighten them out. They really danced anround anything of substance, however, one participant did say that he was starting to see some PANIC in SD. I hope this is a portent of things to come.

[denverite]

I thought there was a significant qoute in the article.

“”I know you’re not supposed to say I told you so,’ but I’m at the age where I can do it: Homeownership was oversold,” says 67-year-old House Finance Committee Chairman Barney Frank (D-Mass.). ”

What, a powerful liberal Democrat, conceding this? … perhaps we won’t be subsidizing the RE bubble after all.

On a slightly different note, the News Hour held a town hall metting that consisted of San Diego bankers, mortgage brokers, realtors, speculators, counselors, and a few home owner/foreclosed individuals. I was disappointed when Gwen Ifill (softball on all subjects) provided the moderator role, but did catch the last 2/3’s of the segment. No one even mentioned the home valuation as the problem. A Pigg point of view should have been there to straighten them out. They really danced anround anything of substance, however, one participant did say that he was starting to see some PANIC in SD. I hope this is a portent of things to come.

[Author]

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