Well, I’m pretty sick to my stomach!

[(former)FormerSanDiegan]

Fun with plots …

Just for kicks, I did my own half-assed projection. But instead of drawing a cartoon, like Powayseller did on her web site, I posed a hypothesis: that perhaps this cycle is just like last time, but longer.

I tweaked the growth rate to exactly hit the last bottom: This came out to 6.2%

Assuming that this cycle is like the last time, I assumed that 2005 was the equivalent to 1990 in the last cycle. Then I used the Year-over year percentage declines from the 90’s bust to project from 2005 forward. That started turning up too soon, so I assumed that the decline in the fourth year of the 90’s decline (nearly 5%) continued on until I hit the 6.2% growth line assumption. The plot below is the result.

So there you go, based on one definition of “normal” growth, I would expect around a 22% nominal price decline from the peak lasting to about 2011-2012.

This is consistent with other computations of the level that houses are over-priced (including Rich’s if you assume that 3% annual inflation accounts for the other 20%+ loss in real prices).

Just another half-a$$ed way to get the same answer.

This is not a prediction of the trajectory we will follow this time, but I’m betting that the end result is pretty close.

[img_assist|nid=3596|title=another half-a$$ed projection|desc=|link=node|align=left|width=466|height=349]

[(former)FormerSanDiegan]

Fun with plots …

Just for kicks, I did my own half-assed projection. But instead of drawing a cartoon, like Powayseller did on her web site, I posed a hypothesis: that perhaps this cycle is just like last time, but longer.

I tweaked the growth rate to exactly hit the last bottom: This came out to 6.2%

Assuming that this cycle is like the last time, I assumed that 2005 was the equivalent to 1990 in the last cycle. Then I used the Year-over year percentage declines from the 90’s bust to project from 2005 forward. That started turning up too soon, so I assumed that the decline in the fourth year of the 90’s decline (nearly 5%) continued on until I hit the 6.2% growth line assumption. The plot below is the result.

So there you go, based on one definition of “normal” growth, I would expect around a 22% nominal price decline from the peak lasting to about 2011-2012.

This is consistent with other computations of the level that houses are over-priced (including Rich’s if you assume that 3% annual inflation accounts for the other 20%+ loss in real prices).

Just another half-a$$ed way to get the same answer.

This is not a prediction of the trajectory we will follow this time, but I’m betting that the end result is pretty close.

[img_assist|nid=3596|title=another half-a$$ed projection|desc=|link=node|align=left|width=466|height=349]

[sdcellar]

FSD– One thing your graph lacks compared to powayseller’s hand drawn one is that it doesn’t actually curve back in time. Nice try though…

[sdcellar]

FSD– One thing your graph lacks compared to powayseller’s hand drawn one is that it doesn’t actually curve back in time. Nice try though…

[(former)FormerSanDiegan]

FSD– One thing your graph lacks compared to powayseller’s hand drawn one is that it doesn’t actually curve back in time. Nice try though…

Yeah, I guess I am limiting myself by the fact that I bought into that single-valued function thingy they taught me in the 7th grade.

[(former)FormerSanDiegan]

FSD– One thing your graph lacks compared to powayseller’s hand drawn one is that it doesn’t actually curve back in time. Nice try though…

Yeah, I guess I am limiting myself by the fact that I bought into that single-valued function thingy they taught me in the 7th grade.

[drunkle]

that 6.2% growth has got to be way too high. it doesn’t seem to be based on anything except sales since the 70’s. using past sales prices to project growth has got to be flawed…

someone else said re growth, globally and over a “long” period of time was on the order of .2%. dont remember who, someone on youtube, probably…

[drunkle]

that 6.2% growth has got to be way too high. it doesn’t seem to be based on anything except sales since the 70’s. using past sales prices to project growth has got to be flawed…

someone else said re growth, globally and over a “long” period of time was on the order of .2%. dont remember who, someone on youtube, probably…

[ibjames]

where is poway’s graph?

[ibjames]

where is poway’s graph?

[(former)FormerSanDiegan]

ibjames – You can find it posted by lurkor on page one of the following thread …
http://piggington.com/public_attacks_by_powayseller_against_rich

You can also find some parodies of other charts in the same thread, such as the one made by lniles…
http://piggington.com/whoa

[(former)FormerSanDiegan]

ibjames – You can find it posted by lurkor on page one of the following thread …
http://piggington.com/public_attacks_by_powayseller_against_rich

You can also find some parodies of other charts in the same thread, such as the one made by lniles…
http://piggington.com/whoa

[sdcellar]

There’s an even better one, but I couldn’t find it. This (link retracted) should give you an idea though.

…never mind. FSD found it while I was wasting my time. I didn’t really want to send anybody to her site anyway.

[sdcellar]

There’s an even better one, but I couldn’t find it. This (link retracted) should give you an idea though.

…never mind. FSD found it while I was wasting my time. I didn’t really want to send anybody to her site anyway.

[NotCranky]

FSD,If we follow your exponential chart the next peak will be infinity? We don’t reach anything like comparable to historical affordability unless the median shoots about 3 feet below 6% line…or, if that is the inflation adjusted scenario take cover.

[Author]

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