[hpi]

Nobody is immune to the inflation that’s already come. Isn’t it a bailout of the over-priced estate value in a long term? The crashing the RE market is not a free show, the green paper in your pocket is losing value everyday for it. There is no smart or stupid due to big uncertainty of the future. There is only lucky and unlucky after watching the show plays out.

[hpi]

Nobody is immune to the inflation that’s already come. Isn’t it a bailout of the over-priced estate value in a long term? The crashing the RE market is not a free show, the green paper in your pocket is losing value everyday for it. There is no smart or stupid due to big uncertainty of the future. There is only lucky and unlucky after watching the show plays out.

[hpi]

Nobody is immune to the inflation that’s already come. Isn’t it a bailout of the over-priced estate value in a long term? The crashing the RE market is not a free show, the green paper in your pocket is losing value everyday for it. There is no smart or stupid due to big uncertainty of the future. There is only lucky and unlucky after watching the show plays out.

[hpi]

Nobody is immune to the inflation that’s already come. Isn’t it a bailout of the over-priced estate value in a long term? The crashing the RE market is not a free show, the green paper in your pocket is losing value everyday for it. There is no smart or stupid due to big uncertainty of the future. There is only lucky and unlucky after watching the show plays out.

[hpi]

Nobody is immune to the inflation that’s already come. Isn’t it a bailout of the over-priced estate value in a long term? The crashing the RE market is not a free show, the green paper in your pocket is losing value everyday for it. There is no smart or stupid due to big uncertainty of the future. There is only lucky and unlucky after watching the show plays out.

[hpi]

I am not sure 40% drop is possible, because the calculation of rent vs buy can only support 10-20% drop, if rent is supposed to be equal to the holding cost of same property (interest, property tax, hoa). While historically the holding cost is bigger than rent in california.

I bet investors or speculators will start to jump back to the market with another 10% drop of RE price, which is the best way to offset the inflation, if inflation is under way. The SD market has been heavily influenced by investment and speculation activities unfortunately. This was a special market and will always be.

[hpi]

I am not sure 40% drop is possible, because the calculation of rent vs buy can only support 10-20% drop, if rent is supposed to be equal to the holding cost of same property (interest, property tax, hoa). While historically the holding cost is bigger than rent in california.

I bet investors or speculators will start to jump back to the market with another 10% drop of RE price, which is the best way to offset the inflation, if inflation is under way. The SD market has been heavily influenced by investment and speculation activities unfortunately. This was a special market and will always be.

[hpi]

I am not sure 40% drop is possible, because the calculation of rent vs buy can only support 10-20% drop, if rent is supposed to be equal to the holding cost of same property (interest, property tax, hoa). While historically the holding cost is bigger than rent in california.

I bet investors or speculators will start to jump back to the market with another 10% drop of RE price, which is the best way to offset the inflation, if inflation is under way. The SD market has been heavily influenced by investment and speculation activities unfortunately. This was a special market and will always be.

[hpi]

I am not sure 40% drop is possible, because the calculation of rent vs buy can only support 10-20% drop, if rent is supposed to be equal to the holding cost of same property (interest, property tax, hoa). While historically the holding cost is bigger than rent in california.

I bet investors or speculators will start to jump back to the market with another 10% drop of RE price, which is the best way to offset the inflation, if inflation is under way. The SD market has been heavily influenced by investment and speculation activities unfortunately. This was a special market and will always be.

[hpi]

I am not sure 40% drop is possible, because the calculation of rent vs buy can only support 10-20% drop, if rent is supposed to be equal to the holding cost of same property (interest, property tax, hoa). While historically the holding cost is bigger than rent in california.

I bet investors or speculators will start to jump back to the market with another 10% drop of RE price, which is the best way to offset the inflation, if inflation is under way. The SD market has been heavily influenced by investment and speculation activities unfortunately. This was a special market and will always be.

[hpi]

how low the price to be depends on several factors:

1. inflation
2. bailout plan
3. local job market
4. national economy
5. current rent price
6. inventory level

If US loses 10% of its GDP with modest-inflation and unemployment going up to 7-8% in the next 3 years, we will see another 20+% down in RE market (~6-8% drop per year). But if this is inevitable, the Feds will use inflation to counter the damage, so my guesses for what will happen (for the next 3 years) are:

Scenario 1: the economy go downs 10%, the inflation 10-15%, unemployment 6-7%, the house market in bad district down 15-20%, good district 8-10%, another 15-20% of 2004-2006 purchase goes to foreclosure (note already 10% of them sold at a lower price in 2007 as short sale or foreclosure)

Scenario 2: the economy flat, inflation 5%, the house market in bad area down 10-15%, for good district 5%, the another 10-15% foreclosure of 2004-2006 purchases

Scenario 3: in the bottom right now, the economy flat or modest increase, the inflation 5-10%, the house market in bad district down 10%, good district flat, 10% foreclosure of 2004-2006 purchase

Obviously scenario 1 is the worst, for some area, we will expect 20+% drop in price, but not for all the areas.

[hpi]

how low the price to be depends on several factors:

1. inflation
2. bailout plan
3. local job market
4. national economy
5. current rent price
6. inventory level

If US loses 10% of its GDP with modest-inflation and unemployment going up to 7-8% in the next 3 years, we will see another 20+% down in RE market (~6-8% drop per year). But if this is inevitable, the Feds will use inflation to counter the damage, so my guesses for what will happen (for the next 3 years) are:

Scenario 1: the economy go downs 10%, the inflation 10-15%, unemployment 6-7%, the house market in bad district down 15-20%, good district 8-10%, another 15-20% of 2004-2006 purchase goes to foreclosure (note already 10% of them sold at a lower price in 2007 as short sale or foreclosure)

Scenario 2: the economy flat, inflation 5%, the house market in bad area down 10-15%, for good district 5%, the another 10-15% foreclosure of 2004-2006 purchases

Scenario 3: in the bottom right now, the economy flat or modest increase, the inflation 5-10%, the house market in bad district down 10%, good district flat, 10% foreclosure of 2004-2006 purchase

Obviously scenario 1 is the worst, for some area, we will expect 20+% drop in price, but not for all the areas.

[hpi]

how low the price to be depends on several factors:

1. inflation
2. bailout plan
3. local job market
4. national economy
5. current rent price
6. inventory level

If US loses 10% of its GDP with modest-inflation and unemployment going up to 7-8% in the next 3 years, we will see another 20+% down in RE market (~6-8% drop per year). But if this is inevitable, the Feds will use inflation to counter the damage, so my guesses for what will happen (for the next 3 years) are:

Scenario 1: the economy go downs 10%, the inflation 10-15%, unemployment 6-7%, the house market in bad district down 15-20%, good district 8-10%, another 15-20% of 2004-2006 purchase goes to foreclosure (note already 10% of them sold at a lower price in 2007 as short sale or foreclosure)

Scenario 2: the economy flat, inflation 5%, the house market in bad area down 10-15%, for good district 5%, the another 10-15% foreclosure of 2004-2006 purchases

Scenario 3: in the bottom right now, the economy flat or modest increase, the inflation 5-10%, the house market in bad district down 10%, good district flat, 10% foreclosure of 2004-2006 purchase

Obviously scenario 1 is the worst, for some area, we will expect 20+% drop in price, but not for all the areas.

[hpi]

how low the price to be depends on several factors:

1. inflation
2. bailout plan
3. local job market
4. national economy
5. current rent price
6. inventory level

If US loses 10% of its GDP with modest-inflation and unemployment going up to 7-8% in the next 3 years, we will see another 20+% down in RE market (~6-8% drop per year). But if this is inevitable, the Feds will use inflation to counter the damage, so my guesses for what will happen (for the next 3 years) are:

Scenario 1: the economy go downs 10%, the inflation 10-15%, unemployment 6-7%, the house market in bad district down 15-20%, good district 8-10%, another 15-20% of 2004-2006 purchase goes to foreclosure (note already 10% of them sold at a lower price in 2007 as short sale or foreclosure)

Scenario 2: the economy flat, inflation 5%, the house market in bad area down 10-15%, for good district 5%, the another 10-15% foreclosure of 2004-2006 purchases

Scenario 3: in the bottom right now, the economy flat or modest increase, the inflation 5-10%, the house market in bad district down 10%, good district flat, 10% foreclosure of 2004-2006 purchase

Obviously scenario 1 is the worst, for some area, we will expect 20+% drop in price, but not for all the areas.

[hpi]

how low the price to be depends on several factors:

1. inflation
2. bailout plan
3. local job market
4. national economy
5. current rent price
6. inventory level

If US loses 10% of its GDP with modest-inflation and unemployment going up to 7-8% in the next 3 years, we will see another 20+% down in RE market (~6-8% drop per year). But if this is inevitable, the Feds will use inflation to counter the damage, so my guesses for what will happen (for the next 3 years) are:

Scenario 1: the economy go downs 10%, the inflation 10-15%, unemployment 6-7%, the house market in bad district down 15-20%, good district 8-10%, another 15-20% of 2004-2006 purchase goes to foreclosure (note already 10% of them sold at a lower price in 2007 as short sale or foreclosure)

Scenario 2: the economy flat, inflation 5%, the house market in bad area down 10-15%, for good district 5%, the another 10-15% foreclosure of 2004-2006 purchases

Scenario 3: in the bottom right now, the economy flat or modest increase, the inflation 5-10%, the house market in bad district down 10%, good district flat, 10% foreclosure of 2004-2006 purchase

Obviously scenario 1 is the worst, for some area, we will expect 20+% drop in price, but not for all the areas.

[Author]

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