On Topic – We hit bottom

[BGinRB]

[quote=FormerSanDiegan]Based on fundamentals we are below the long-term average in terms of monthly housing costs relative to rents and incomes. [/quote]

Rich’s recent graph shows that the ratio you quoted is nearing the top of the previous bubble. We are not even below the pre-2002 maximum.

[(former)FormerSanDiegan]

[quote=BGinRB][quote=FormerSanDiegan]Based on fundamentals we are below the long-term average in terms of monthly housing costs relative to rents and incomes. [/quote]

Rich’s recent graph shows that the ratio you quoted is nearing the top of the previous bubble. We are not even below the pre-2002 maximum.
[/quote]

You are mistaken. Clearly the monthly housing costs relative to rent and incomes are below 30-year averages as shown in Rich’s recent charts.

Monthly House Payments, Rents, and Incomes

[(former)FormerSanDiegan]

[quote=BGinRB][quote=FormerSanDiegan]Based on fundamentals we are below the long-term average in terms of monthly housing costs relative to rents and incomes. [/quote]

Rich’s recent graph shows that the ratio you quoted is nearing the top of the previous bubble. We are not even below the pre-2002 maximum.
[/quote]

You are mistaken. Clearly the monthly housing costs relative to rent and incomes are below 30-year averages as shown in Rich’s recent charts.

Monthly House Payments, Rents, and Incomes

[(former)FormerSanDiegan]

[quote=BGinRB][quote=FormerSanDiegan]Based on fundamentals we are below the long-term average in terms of monthly housing costs relative to rents and incomes. [/quote]

Rich’s recent graph shows that the ratio you quoted is nearing the top of the previous bubble. We are not even below the pre-2002 maximum.
[/quote]

You are mistaken. Clearly the monthly housing costs relative to rent and incomes are below 30-year averages as shown in Rich’s recent charts.

Monthly House Payments, Rents, and Incomes

[(former)FormerSanDiegan]

[quote=BGinRB][quote=FormerSanDiegan]Based on fundamentals we are below the long-term average in terms of monthly housing costs relative to rents and incomes. [/quote]

Rich’s recent graph shows that the ratio you quoted is nearing the top of the previous bubble. We are not even below the pre-2002 maximum.
[/quote]

You are mistaken. Clearly the monthly housing costs relative to rent and incomes are below 30-year averages as shown in Rich’s recent charts.

Monthly House Payments, Rents, and Incomes

[(former)FormerSanDiegan]

[quote=BGinRB][quote=FormerSanDiegan]Based on fundamentals we are below the long-term average in terms of monthly housing costs relative to rents and incomes. [/quote]

Rich’s recent graph shows that the ratio you quoted is nearing the top of the previous bubble. We are not even below the pre-2002 maximum.
[/quote]

You are mistaken. Clearly the monthly housing costs relative to rent and incomes are below 30-year averages as shown in Rich’s recent charts.

Monthly House Payments, Rents, and Incomes

[peterb]

My view of the market is strictly as an investor. So calling a bottom to me is not nearly as important as seeing factors that would indicate a recovery. This market could sit on the bottom and languish for a long time, ala Japan.
The trend is still on the down-side from what I am seeing.
One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low. So add that to the prices we’re now seeing. I’d say we’re at 2001 prices, more or less. The problem is that things are getting worse for the economy and unemployment is rising. Foreclosures will probably take over more of the market as well for the next year or so.
Perhaps we’ve seen the biggest drop/time ratio, but I dont see how it is going to stabilize anytime soon. And then again, how long until it has any pressure to cause prices to rise?

[peterb]

My view of the market is strictly as an investor. So calling a bottom to me is not nearly as important as seeing factors that would indicate a recovery. This market could sit on the bottom and languish for a long time, ala Japan.
The trend is still on the down-side from what I am seeing.
One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low. So add that to the prices we’re now seeing. I’d say we’re at 2001 prices, more or less. The problem is that things are getting worse for the economy and unemployment is rising. Foreclosures will probably take over more of the market as well for the next year or so.
Perhaps we’ve seen the biggest drop/time ratio, but I dont see how it is going to stabilize anytime soon. And then again, how long until it has any pressure to cause prices to rise?

[peterb]

My view of the market is strictly as an investor. So calling a bottom to me is not nearly as important as seeing factors that would indicate a recovery. This market could sit on the bottom and languish for a long time, ala Japan.
The trend is still on the down-side from what I am seeing.
One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low. So add that to the prices we’re now seeing. I’d say we’re at 2001 prices, more or less. The problem is that things are getting worse for the economy and unemployment is rising. Foreclosures will probably take over more of the market as well for the next year or so.
Perhaps we’ve seen the biggest drop/time ratio, but I dont see how it is going to stabilize anytime soon. And then again, how long until it has any pressure to cause prices to rise?

[peterb]

My view of the market is strictly as an investor. So calling a bottom to me is not nearly as important as seeing factors that would indicate a recovery. This market could sit on the bottom and languish for a long time, ala Japan.
The trend is still on the down-side from what I am seeing.
One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low. So add that to the prices we’re now seeing. I’d say we’re at 2001 prices, more or less. The problem is that things are getting worse for the economy and unemployment is rising. Foreclosures will probably take over more of the market as well for the next year or so.
Perhaps we’ve seen the biggest drop/time ratio, but I dont see how it is going to stabilize anytime soon. And then again, how long until it has any pressure to cause prices to rise?

[peterb]

My view of the market is strictly as an investor. So calling a bottom to me is not nearly as important as seeing factors that would indicate a recovery. This market could sit on the bottom and languish for a long time, ala Japan.
The trend is still on the down-side from what I am seeing.
One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low. So add that to the prices we’re now seeing. I’d say we’re at 2001 prices, more or less. The problem is that things are getting worse for the economy and unemployment is rising. Foreclosures will probably take over more of the market as well for the next year or so.
Perhaps we’ve seen the biggest drop/time ratio, but I dont see how it is going to stabilize anytime soon. And then again, how long until it has any pressure to cause prices to rise?

[Anonymous]

One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low.

I don’t know how many times this needs to be repeated, home prices correspond to wage inflation not price inflation. In real terms 2008 wages are flat to 2000 wages if inflation equals the CPI. Because of this, I would say CPI is a relatively good metric to show how house prices should have inflated over the last 7-8 years because wages tracked it. If inflation was significantly higher than that, but wage inflation tracked CPI then there is less available money to purchase houses and we shouldn’t see home price increases just on inflation alone.

[Anonymous]

One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low.

I don’t know how many times this needs to be repeated, home prices correspond to wage inflation not price inflation. In real terms 2008 wages are flat to 2000 wages if inflation equals the CPI. Because of this, I would say CPI is a relatively good metric to show how house prices should have inflated over the last 7-8 years because wages tracked it. If inflation was significantly higher than that, but wage inflation tracked CPI then there is less available money to purchase houses and we shouldn’t see home price increases just on inflation alone.

[Anonymous]

One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low.

I don’t know how many times this needs to be repeated, home prices correspond to wage inflation not price inflation. In real terms 2008 wages are flat to 2000 wages if inflation equals the CPI. Because of this, I would say CPI is a relatively good metric to show how house prices should have inflated over the last 7-8 years because wages tracked it. If inflation was significantly higher than that, but wage inflation tracked CPI then there is less available money to purchase houses and we shouldn’t see home price increases just on inflation alone.

[Anonymous]

One thing I will say is that if you believe the CPI, inflations was 25% from 2001 to 2008, and we all know it’s probably too low.

I don’t know how many times this needs to be repeated, home prices correspond to wage inflation not price inflation. In real terms 2008 wages are flat to 2000 wages if inflation equals the CPI. Because of this, I would say CPI is a relatively good metric to show how house prices should have inflated over the last 7-8 years because wages tracked it. If inflation was significantly higher than that, but wage inflation tracked CPI then there is less available money to purchase houses and we shouldn’t see home price increases just on inflation alone.

[Author]

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