The often asked question, when will housing bottom?

[Fearful]

We are a long, long way from the bottom. People are still talking about real estate as a good long term investment. I saw this posted just today, elsewhere:

—-

I’m good with real estate for now… Have over half a million in three mortages for two condos. If I can ever sell my Encinitas rental I’ll buy another downtown unit. Prolly also finish getting my brokers license at that point.

[Bugs]

What I always try to remember is that during the past bust I was waaay to optimistic about when the market would turn. During the 90s I called the bottom 2 years early, and then I repeated that mistake by (privately) calling the subsequent peak 2 years early. I’m done with making that mistake.

The only reason I am confident it won’t turn prior to 2010 is because of the current overhang in inventory, the tightening of the credit markets, the resetting arm schedule, and the prevailing market psychology. From where we are right now, this boat is too big to turn around in less than 2 years.

[Bugs]

What I always try to remember is that during the past bust I was waaay to optimistic about when the market would turn. During the 90s I called the bottom 2 years early, and then I repeated that mistake by (privately) calling the subsequent peak 2 years early. I’m done with making that mistake.

The only reason I am confident it won’t turn prior to 2010 is because of the current overhang in inventory, the tightening of the credit markets, the resetting arm schedule, and the prevailing market psychology. From where we are right now, this boat is too big to turn around in less than 2 years.

[Bugs]

What I always try to remember is that during the past bust I was waaay to optimistic about when the market would turn. During the 90s I called the bottom 2 years early, and then I repeated that mistake by (privately) calling the subsequent peak 2 years early. I’m done with making that mistake.

The only reason I am confident it won’t turn prior to 2010 is because of the current overhang in inventory, the tightening of the credit markets, the resetting arm schedule, and the prevailing market psychology. From where we are right now, this boat is too big to turn around in less than 2 years.

[Bugs]

What I always try to remember is that during the past bust I was waaay to optimistic about when the market would turn. During the 90s I called the bottom 2 years early, and then I repeated that mistake by (privately) calling the subsequent peak 2 years early. I’m done with making that mistake.

The only reason I am confident it won’t turn prior to 2010 is because of the current overhang in inventory, the tightening of the credit markets, the resetting arm schedule, and the prevailing market psychology. From where we are right now, this boat is too big to turn around in less than 2 years.

[Bugs]

What I always try to remember is that during the past bust I was waaay to optimistic about when the market would turn. During the 90s I called the bottom 2 years early, and then I repeated that mistake by (privately) calling the subsequent peak 2 years early. I’m done with making that mistake.

The only reason I am confident it won’t turn prior to 2010 is because of the current overhang in inventory, the tightening of the credit markets, the resetting arm schedule, and the prevailing market psychology. From where we are right now, this boat is too big to turn around in less than 2 years.

[sdrealtor]

Maybe Bugs can confirm this but my recollection was that the majority of purchases between 2003 and 2005 in the coastal areas among prime buyers was 5/1 arm’s with rates in the 3 to 4% range. It should take a year or two for the pain to sink in as many of these folks have ample reserves. I believe 2011/2012 is the right call for a bottom.

[sdrealtor]

Maybe Bugs can confirm this but my recollection was that the majority of purchases between 2003 and 2005 in the coastal areas among prime buyers was 5/1 arm’s with rates in the 3 to 4% range. It should take a year or two for the pain to sink in as many of these folks have ample reserves. I believe 2011/2012 is the right call for a bottom.

[sdrealtor]

Maybe Bugs can confirm this but my recollection was that the majority of purchases between 2003 and 2005 in the coastal areas among prime buyers was 5/1 arm’s with rates in the 3 to 4% range. It should take a year or two for the pain to sink in as many of these folks have ample reserves. I believe 2011/2012 is the right call for a bottom.

[sdrealtor]

Maybe Bugs can confirm this but my recollection was that the majority of purchases between 2003 and 2005 in the coastal areas among prime buyers was 5/1 arm’s with rates in the 3 to 4% range. It should take a year or two for the pain to sink in as many of these folks have ample reserves. I believe 2011/2012 is the right call for a bottom.

[sdrealtor]

Maybe Bugs can confirm this but my recollection was that the majority of purchases between 2003 and 2005 in the coastal areas among prime buyers was 5/1 arm’s with rates in the 3 to 4% range. It should take a year or two for the pain to sink in as many of these folks have ample reserves. I believe 2011/2012 is the right call for a bottom.

[vizcaya]

Paramount I used the same numbers/assumptions of when the bottom would be, while placing bids back in July
You said:

Total Price Decline: I would say around 30% from the peak on average.

I used this percentage(30%) when I placed bids on a bank owned homes the wife and I liked.

The home we went with was sold at peak for $570k in 2005. I placed a bid on it for $420k(about 26% below peak). The bank accepted. Since the drop from peak was close to my assumptions of when the bottom would be, we bought now instead of waiting a couple of years till the bottom.

Looking at the market now, I still believe that my house will drop another 10% before it hits bottom. Which would be a 40% drop from Peak. Therfore It looks like my house which sold at peak for $570k in 2005, should be worth approx $350k by 2011.
Ouch!

[vizcaya]

Paramount I used the same numbers/assumptions of when the bottom would be, while placing bids back in July
You said:

Total Price Decline: I would say around 30% from the peak on average.

I used this percentage(30%) when I placed bids on a bank owned homes the wife and I liked.

The home we went with was sold at peak for $570k in 2005. I placed a bid on it for $420k(about 26% below peak). The bank accepted. Since the drop from peak was close to my assumptions of when the bottom would be, we bought now instead of waiting a couple of years till the bottom.

Looking at the market now, I still believe that my house will drop another 10% before it hits bottom. Which would be a 40% drop from Peak. Therfore It looks like my house which sold at peak for $570k in 2005, should be worth approx $350k by 2011.
Ouch!

[vizcaya]

Paramount I used the same numbers/assumptions of when the bottom would be, while placing bids back in July
You said:

Total Price Decline: I would say around 30% from the peak on average.

I used this percentage(30%) when I placed bids on a bank owned homes the wife and I liked.

The home we went with was sold at peak for $570k in 2005. I placed a bid on it for $420k(about 26% below peak). The bank accepted. Since the drop from peak was close to my assumptions of when the bottom would be, we bought now instead of waiting a couple of years till the bottom.

Looking at the market now, I still believe that my house will drop another 10% before it hits bottom. Which would be a 40% drop from Peak. Therfore It looks like my house which sold at peak for $570k in 2005, should be worth approx $350k by 2011.
Ouch!

[vizcaya]

Paramount I used the same numbers/assumptions of when the bottom would be, while placing bids back in July
You said:

Total Price Decline: I would say around 30% from the peak on average.

I used this percentage(30%) when I placed bids on a bank owned homes the wife and I liked.

The home we went with was sold at peak for $570k in 2005. I placed a bid on it for $420k(about 26% below peak). The bank accepted. Since the drop from peak was close to my assumptions of when the bottom would be, we bought now instead of waiting a couple of years till the bottom.

Looking at the market now, I still believe that my house will drop another 10% before it hits bottom. Which would be a 40% drop from Peak. Therfore It looks like my house which sold at peak for $570k in 2005, should be worth approx $350k by 2011.
Ouch!

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