DOWN 80% FROM THE PEAK

Housing prices are predicted to fall another 11% nationwide by June of 2010.  In some the worst markets the decline from peak will be a whopping 80%.  In places like Miami, Las Vegas, Phoenix prices will fall and additional 25 to 30% in the next nine months.  If this even comes close to the prediction my original estimate of ending prices in places like Sacramento, CA will fall to below $125,000 .  This ain’t by rocket science either it’s simply looking at a chart of prices in sac over 30 years or so and know one simple fact, prices always return to a level that would exist if bubbles never happened.  In the case of real estate that’s an average increase of about 3%.  Moody’s  have said prices will return to Peak levels within 10 years.   In your heart you know that’s BULLCRAP.  A ten year recovery would mean an annual appreciation of over 7%. it ain’t gonna happen.  With unemployment at 22% (in the real world) and will not improve any time soon and will get worse before it gets better prices will most likely not even rise.  With normal lending requirements not many will be able to qualify for the loans.

HERE’S THE STORY

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3 Comments on “DOWN 80% FROM THE PEAK”

  1. Larry J Says:

    Since America has lost most of the manufacturing jobs and most of the jobs in the USA are just lower paid service jobs this will put housing prices back into the range where more people will be able to buy homes at the more realistic and affordable prices.
    Thus, lower house prices are good. People should get back to the fact that houses shouldn’t be their main investment.
    It used to be a person could move to any city or area they wanted, but now many areas and cities are unaffordable to even the average person.

  2. Jon M Barker Says:

    Larry J has it right! The problem with home prices has always been The greed of the property owner loan agency combo, assisted by the politico greasing the way to buy to the point of the absurd inflation of prices beyond the value of said property and the realistic abilities of ability to earn. The American dream has become Fantasia….

  3. the grey tiger Says:

    The idea that a house is an investment vehicle has always been wrong to me. A house is a place to keep the rain o your head nothing more. Greed no doubt played a part but not the way it is generally put out, most of greed was from the financial side of the system. Had they not changed the rules of qualifying for a loan none of this bubble would have happened. The crooks on the loan side knew when they gave these mortgages that they would not hold them more than 30 days they would package them and get them og their books as derivatives . They knew they would foreclose that’s whey they didn’t do or destroyed the registration at the county level. Now that’s coming back bite them judges are saying they can’t prove ownership so they can’t foreclose. Most consumers are not smart enough to know they are being had.


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