Housing Prices Are Still Headed Down 15 comments
February 27, 2008
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The latest news is really bad for developers selling houses:
That decline reflects two things: first, that we builders have constructed far more homes than Americans need, and second, that they are facing reality that there are too many homes. To sell, you need to cut the price. Here's how the supply of new homes looks:
That horizontal line is the average inventory of unsold homes. At the rate we're going, we'll get there in June 2010. Maybe a little faster, or a little slower. But not next month, or even next year.
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This article has 15 comments:
Housing is going to recover. There is only one final piece of the puzzle and it's on its way. Prices just have to decline another 35%.
Or maybe 40%.
But we are on the way, baby! Recovery city! Just one last dip and it's off we go! Wheeeeee!
Yeah, they're not making any more land... wait a minute, don't realtors say that a lot... you wouldn't be... nah!
Ah ha - you hit the nail right on the head man - PRICES HAVE TO DECLINE 35% or 40%. I salute you!
If the buying public wasn't so stupid and gullible they wouldn't have fallen for this ponzi scheme in the first place!
Anyhow, long term rates (esp. mortgages) continue to be driven up by inflation worries along with a huge credit risk spread. It will be interesting to see how Bernanke responds as these short term cuts push us ever closer to stagflation with no benefit to housing...
But the prices were too high
A pretty good salary I make
But no more than 3X would I let them take
So a renter I gladly stayed
And I’m oh so happy today
Sujo
But the prices were too high
A pretty good salary I make
But no more than 3X would I let them take
So a renter I gladly stayed
And I’m oh so happy today
Sujo
I agree with your sentiment, but instead of affordability I would substitute "long term affordability". As you know, loose lending made these McMansions affordable in the immediate sense of being able to get financing.......but as you point out unaffordable by conservative, best practices.
Can you expect the guys with power tools to be economists ?
Or is it better we blame the financial operators for much of the problem ?
Seems like the financial operators deserve more blame than the homebuilders.....
jbd.
"Prices just have to decline another 35%.
Or maybe 40%.
But we are on the way, baby! Recovery city! Just one last dip and it's off we go! Wheeeeee!"
It's funny cause its true.
I dunno. Everyone's been down on Hitler for 60 years but it doesn't mean it's a good time to become a Nazi...
not sure everyone is negative are they?
just think about the demand on the way up -first time buyers, immigrants, investors. they built as fast as they could to give them what they wanted.
and now on the way down - how many buyers? and how many sellers? this housing market crash will go on for a while yet just to clear the market of unmatched trades!