Calling the bottom with a Sharpie

[hugo]

Thanks Cricket. Here’s a NYTimes graphic that I linked on another thread (go the the second graphic). Like your graphs, it shows we are not yet back down to the tops of the previous housing upticks in the 70’s and 80’s.

[sdchris]

[quote=SanDiegoDave]Inflation will hit long before a year 2013 bottom is reached. In terms of adjusting for inflation, it “may” be accurate. But in real dollars, we’ll hit bottom by mid-2010.[/quote]

I agree with this. At some point we’re not going to see a decline in home prices. They’ll probably remain stagnant for years allowing inflation to catch up.

[sdchris]

[quote=SanDiegoDave]Inflation will hit long before a year 2013 bottom is reached. In terms of adjusting for inflation, it “may” be accurate. But in real dollars, we’ll hit bottom by mid-2010.[/quote]

I agree with this. At some point we’re not going to see a decline in home prices. They’ll probably remain stagnant for years allowing inflation to catch up.

[sdchris]

[quote=SanDiegoDave]Inflation will hit long before a year 2013 bottom is reached. In terms of adjusting for inflation, it “may” be accurate. But in real dollars, we’ll hit bottom by mid-2010.[/quote]

I agree with this. At some point we’re not going to see a decline in home prices. They’ll probably remain stagnant for years allowing inflation to catch up.

[sdchris]

[quote=SanDiegoDave]Inflation will hit long before a year 2013 bottom is reached. In terms of adjusting for inflation, it “may” be accurate. But in real dollars, we’ll hit bottom by mid-2010.[/quote]

I agree with this. At some point we’re not going to see a decline in home prices. They’ll probably remain stagnant for years allowing inflation to catch up.

[sdchris]

[quote=SanDiegoDave]Inflation will hit long before a year 2013 bottom is reached. In terms of adjusting for inflation, it “may” be accurate. But in real dollars, we’ll hit bottom by mid-2010.[/quote]

I agree with this. At some point we’re not going to see a decline in home prices. They’ll probably remain stagnant for years allowing inflation to catch up.

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

OK. I agree that’s one possible scenario. But Warren Buffett said, “Predicting rain doesn’t count, building arks does.” So what do you suggest us to do now to prepare for that? Starting to hoard cash so that one can pick up a property with 100% cash at low-priced area at that time? But if things are that bad, shouldn’t people really start to worry about the low-priced neighborhood turning into ghetto?
How can we likely profit from the above scenario or you think we are doomed regardlessly?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

OK. I agree that’s one possible scenario. But Warren Buffett said, “Predicting rain doesn’t count, building arks does.” So what do you suggest us to do now to prepare for that? Starting to hoard cash so that one can pick up a property with 100% cash at low-priced area at that time? But if things are that bad, shouldn’t people really start to worry about the low-priced neighborhood turning into ghetto?
How can we likely profit from the above scenario or you think we are doomed regardlessly?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

OK. I agree that’s one possible scenario. But Warren Buffett said, “Predicting rain doesn’t count, building arks does.” So what do you suggest us to do now to prepare for that? Starting to hoard cash so that one can pick up a property with 100% cash at low-priced area at that time? But if things are that bad, shouldn’t people really start to worry about the low-priced neighborhood turning into ghetto?
How can we likely profit from the above scenario or you think we are doomed regardlessly?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

OK. I agree that’s one possible scenario. But Warren Buffett said, “Predicting rain doesn’t count, building arks does.” So what do you suggest us to do now to prepare for that? Starting to hoard cash so that one can pick up a property with 100% cash at low-priced area at that time? But if things are that bad, shouldn’t people really start to worry about the low-priced neighborhood turning into ghetto?
How can we likely profit from the above scenario or you think we are doomed regardlessly?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

OK. I agree that’s one possible scenario. But Warren Buffett said, “Predicting rain doesn’t count, building arks does.” So what do you suggest us to do now to prepare for that? Starting to hoard cash so that one can pick up a property with 100% cash at low-priced area at that time? But if things are that bad, shouldn’t people really start to worry about the low-priced neighborhood turning into ghetto?
How can we likely profit from the above scenario or you think we are doomed regardlessly?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

By the way, just want to emphasize that this is a much worse scenario than what is predicted by OP. Others are still predicting 1997 inflation-adjusted price but I think you are predicting 1997 nominal price. The economy is deteriorating fast from the beginning of this year, so I don’t want to rule out your scenario. I am just wondering what is the optimal plan to manage such risk?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

By the way, just want to emphasize that this is a much worse scenario than what is predicted by OP. Others are still predicting 1997 inflation-adjusted price but I think you are predicting 1997 nominal price. The economy is deteriorating fast from the beginning of this year, so I don’t want to rule out your scenario. I am just wondering what is the optimal plan to manage such risk?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

By the way, just want to emphasize that this is a much worse scenario than what is predicted by OP. Others are still predicting 1997 inflation-adjusted price but I think you are predicting 1997 nominal price. The economy is deteriorating fast from the beginning of this year, so I don’t want to rule out your scenario. I am just wondering what is the optimal plan to manage such risk?

[carlsbadworker]

[quote=peterb]I have no problem seeing 1997 prices in the next couple of years….and the reason will be that no one has money to buy a house. Careful what you wish for. I’ve said it before on this site many times….when prices get to where everyone wants them, it will be because the economy is on life support. Will you have a job and the desire to take on a big debt in this situation??
I think fear will rule the day, not greed.[/quote]

By the way, just want to emphasize that this is a much worse scenario than what is predicted by OP. Others are still predicting 1997 inflation-adjusted price but I think you are predicting 1997 nominal price. The economy is deteriorating fast from the beginning of this year, so I don’t want to rule out your scenario. I am just wondering what is the optimal plan to manage such risk?

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