Does this explain your observations

[Huckleberry]

I completely agree. With the severe credit market tightening and mortgages very difficult to acquire, SoCal RE is in for some serious downside repricing.

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

[kewp]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Given the Moody’s article that subprime CDO’s are gone and never coming back, total meltdown looks like its in the bag.

[kewp]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Given the Moody’s article that subprime CDO’s are gone and never coming back, total meltdown looks like its in the bag.

[kewp]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Given the Moody’s article that subprime CDO’s are gone and never coming back, total meltdown looks like its in the bag.

[kewp]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Given the Moody’s article that subprime CDO’s are gone and never coming back, total meltdown looks like its in the bag.

[kewp]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Given the Moody’s article that subprime CDO’s are gone and never coming back, total meltdown looks like its in the bag.

[Eugene]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Do you allow the possibility that perhaps prices and incomes are already at normal ratios?

[Eugene]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Do you allow the possibility that perhaps prices and incomes are already at normal ratios?

[Eugene]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Do you allow the possibility that perhaps prices and incomes are already at normal ratios?

[Eugene]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Do you allow the possibility that perhaps prices and incomes are already at normal ratios?

[Eugene]

Without exotic loan instruments to continue propping this beast up, there is NO WAY this market can stabilize until prices and incomes come back to normal ratios.

Do you allow the possibility that perhaps prices and incomes are already at normal ratios?

[peterb]

Most markets tend to over-correct there normalization or equilibrium models before they stabilize. Given the illiquid nature of real estate and its dependence on financial markets, these over-corrections can go on for a while. Throw rising unemployment and constricting credit into the mix and it will probably put added pressure on the over-correction of prices and duration. Growing negative sentiment will most likely play a large roll as well.
Therefore, I would consider “normal ratio’s” as one indicator towards a slowing decline, but by no means an end of the decline. IMO, there are just too many other large negative forces working on the housing market at this time.
If you study the nature of deflating markets, it’s an amazing economic event and not easily stopped.

[peterb]

Most markets tend to over-correct there normalization or equilibrium models before they stabilize. Given the illiquid nature of real estate and its dependence on financial markets, these over-corrections can go on for a while. Throw rising unemployment and constricting credit into the mix and it will probably put added pressure on the over-correction of prices and duration. Growing negative sentiment will most likely play a large roll as well.
Therefore, I would consider “normal ratio’s” as one indicator towards a slowing decline, but by no means an end of the decline. IMO, there are just too many other large negative forces working on the housing market at this time.
If you study the nature of deflating markets, it’s an amazing economic event and not easily stopped.

[peterb]

Most markets tend to over-correct there normalization or equilibrium models before they stabilize. Given the illiquid nature of real estate and its dependence on financial markets, these over-corrections can go on for a while. Throw rising unemployment and constricting credit into the mix and it will probably put added pressure on the over-correction of prices and duration. Growing negative sentiment will most likely play a large roll as well.
Therefore, I would consider “normal ratio’s” as one indicator towards a slowing decline, but by no means an end of the decline. IMO, there are just too many other large negative forces working on the housing market at this time.
If you study the nature of deflating markets, it’s an amazing economic event and not easily stopped.

[peterb]

Most markets tend to over-correct there normalization or equilibrium models before they stabilize. Given the illiquid nature of real estate and its dependence on financial markets, these over-corrections can go on for a while. Throw rising unemployment and constricting credit into the mix and it will probably put added pressure on the over-correction of prices and duration. Growing negative sentiment will most likely play a large roll as well.
Therefore, I would consider “normal ratio’s” as one indicator towards a slowing decline, but by no means an end of the decline. IMO, there are just too many other large negative forces working on the housing market at this time.
If you study the nature of deflating markets, it’s an amazing economic event and not easily stopped.

[Author]

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