Short Interview with Chris Thornberg

[Steve Beebo]

 

 

 http://blogs.ocregister.com/lansner/archives/2006/11/insider_qa_chris_thornberg_1.html

 

"But don't expect that prices will collapse by, say, 30%. Housing markets aren't that liquid. Declines will be moderate."

[Bugs]

That was (part of) the answer. This is the question:

“Q. Do you have a firm projection of, say, 2007 price movements?”

I agree that the price movement for 2007 probably won’t be -30%. But moderate declines (like maybe -10%) could easily happen and if it does that will be very bad for a lot of people.

Anyone catch the RE section in the Union-Tribune today? We have some high-flyer RE agents who are getting starved out even as we speak. Another -10% year will be really bad news for those folks.

[sdrealtor]

The high flyers in the article were in the business 2 years or less. Not what I’d call high flyers but who am I to say.

[Daniel]

I like his comment about whether this is a “bubble” or “normal cycle”:

Q. Is this a bubble bursting, or just a natural, cyclical easing after a decade of grand performance?
A. It depends on what you mean by the latter vs. the former. If you think the late ‘70s run up in prices was a bubble, and the late ‘80s run up was a bubble, then this is a bubble bursting. The same market characteristics that defined the cooling starting in 1979 and 1989 are what we are seeing today. If you think that what we have seen in the past is just a normal cycle, then this is a normal cycle.

Words like “bubble”, “correction”, “soft landing”, and so on are used so often so vaguely that they don’t have almost any meaning anymore. Thornberg is right: what happened in the early ’90s is going to happen again, whatever words people choose to use for it.

[Author]

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