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Michael David White

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  • Property Values Projected to Fall 12% in 2010 [View article]
    The underlying assumption of the story is that 120 years of history of real estate prices described by Case Shiller must define our interpretation of reality. The trend of property values and mortgage debt says that the flat period of price growth from 1890 to 1990 is supportable. The diversion from that trend after 1990 is unsupportable because property values decoupled from income. Thanks for your question. mdw
    Jan 31 05:11 PM | 4 Likes Like |Link to Comment
  • Property Values Projected to Fall 12% in 2010 [View article]
    If household debt service has not changed in the last 20 or 30 years, then there will be no credit crisis. If, however, the 10 percentile borrowers, the borrowers with the worst debt to income raito, if they cannot pay back any of their debts, that might be enough to bankrupt every bank we have. Don't forget that leverage kills. Please see also newobservations.net/20.../ which looks carefully at the question of debt-to-income ratios for all households in the United States. Thanks for your comment. mdw
    Jan 31 05:02 PM | 4 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    i am going to take a look at a longer trend and see if that makes a difference. thanks for your note.


    On Nov 02 02:39 PM halamok wrote:

    > Your trendline implies home prices should have risen only 30-40%
    > in 22 years,or about 1.5% yearly. This is pretty unrealistic,inflation
    > was certainly higher and material/workforce expenses to build a house
    > are also up more than your trendline assumes.
    Nov 2 04:33 PM | 4 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    all politics and real estate prices are local.


    On Nov 02 01:13 PM Spin wrote:

    > Charts are good for looking at how we got here, but without guesswork
    > they provide little hard evidence for the future.
    >
    > Now with the residentual ARMs resetting and commercial real estate
    > financing in the tank, we have some near term hard evidence of more
    > home foreclosures and business failures that will have an impact
    > on values.
    >
    > Studies show that each foreclosure within 2 blocks of your house
    > lowers the value of your property. This month's reset will not be
    > the last and subsequent resets will also negatively impact values.
    >
    >
    > Some homeowners need to move and others want to move. Those that
    > need to move will suffer if they sell and also lead their old neighborhood's
    > value down. Those that only want to move will stay put hoping for
    > a better price. Many people have a good portion their retirement
    > nestegg locked up in their home's value. This will in effect lock
    > many homeowners out of upgrading or downsizing.
    >
    > That leaves the residential market to first time buyers and investors,
    > which are two groups we see last in support of a sound market. This
    > is a real trap.
    >
    > The market still has some downside, but the percentage of drop depends
    > on location, location, location.
    Nov 2 04:31 PM | 4 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    housing does correct slowly. thanks for the note.


    On Nov 02 10:34 AM JS Partners wrote:

    > Consumers, investors and all other people who are not underwater
    > (which remains a segmented question) do not want to realise the loss
    > on their home but instead would rather choose to use it for practical
    > reasons or seek yield however small.
    >
    > This could certainly prevent a further 40%+ slide in the residential
    > market. And when you see the forced sellers exit the market (like
    > now) there should be a degree of stabilisation. The same way that
    > the market got exhausted from buying, there will be an exhausted
    > seller who would rather sit on a house for 10 years than lose 40%.
    Nov 2 04:28 PM | 4 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    it does seem way too high. no question about that.


    On Nov 02 09:48 AM Smalltownbanker wrote:

    > By the way. The 43% figure is way too high and will not happen.
    > Call that a predicition if you like...
    Nov 2 04:20 PM | 4 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    the chart of prices is just a staring point.


    On Nov 02 09:03 AM enigmaman wrote:

    > anything can happen thats for sure, especially when you consider
    > there are potentially another 8 million homes that could be foreclosed
    > on in the next 4 years. But if you look at the current national average
    > home price it is back to around 2003 levels which is before homes
    > values began to increase by double digits, the norm being 3-5% year
    > prior to this. The key to not going where you project is job creation,
    > once the unemployment stabilizes and reverses home prices will level
    > the longer that takes the lower home prices will go. Its not about
    > your chart its about jobs, your chart exists in a vacuum the economy
    > does not.
    Nov 2 04:16 PM | 4 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    thank you for the correction


    On Nov 02 08:15 AM Tony Petroski wrote:

    > Anyone who can read a chart will point out that property prices are
    > going to fall 43.27%, not just 43%.
    Nov 2 04:14 PM | 4 Likes Like |Link to Comment
  • Pending Home Sales Reconfirm: The Market Is Crashing [View article]
    Hello DM, current buyers with great mortgage rates buy with a known risk -- that affordability will fall when rates go up. my rule of thumb is go ahead and buy now if you are staying for 10 years and you get a great deal and you don't mind buying a loss of 30% or more. get to the 30% loss part and smart buyers run for the hills. thanks for your comment. mdw
    Sep 5 05:25 PM | 3 Likes Like |Link to Comment
  • Key Property Charts to Make Sense of This Week’s Housing Numbers [View article]
    Hello Enigmaman, anybody who understands business knows that this administration operates strictly according to the Martian school of economics. they even wear space suits in the white house. it's trippy. mdw
    Jun 22 08:39 PM | 3 Likes Like |Link to Comment
  • Key Property Charts to Make Sense of This Week’s Housing Numbers [View article]
    Hi Charles, i have heard the Spanish have six times the inventory problem we have and that the banks are financing new construction to boost the values of their REO lots. genius at work. mdw
    Jun 22 08:35 PM | 3 Likes Like |Link to Comment
  • Key Property Charts to Make Sense of This Week’s Housing Numbers [View article]
    Remember this aldol: You can't win an argument against an ignorant man. mdw
    Jun 22 08:31 PM | 3 Likes Like |Link to Comment
  • One in Ten Mortgage Borrowers Will Lose Home Within Two Years [View article]
    Hi Jasper, I had a mix up with Calafia before. We had a broad disagreement. Thanks for your comment . mdw

    newobservations.net/20.../
    May 21 04:08 AM | 3 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    if you can construct the graph with local data, that's the way to go. thanks for your note.


    On Nov 02 07:42 PM Bigman16 wrote:

    > good analysis, just need to detail what is included in the "trend
    > line", as that is what most people would argue about - once you look
    > at the composition of the trend line, you will probably drill down
    > locally and create your own "Case Shiller" for a submarket and use
    > the historical appreciation in that market for your graph.
    Nov 2 09:58 PM | 3 Likes Like |Link to Comment
  • Property Values Set to Fall 43% from Current Depressed Levels [View article]
    yes the equation is much more difficult than one chart, but case shiller numbers may be the best summary to start from.


    On Nov 02 08:13 AM Tom Armistead wrote:

    > Applying technical analysis to the Case Shiller index is an exercise
    > in futility.
    >
    > Information on supply and demand, market value vs. replacement cost,
    > aggregate mortgage debt, etc. would be a better place to look for
    > answers.
    >
    > Many of those who have done the work on these types of information
    > are calling a bottom in housing right now.
    Nov 2 04:15 PM | 3 Likes Like |Link to Comment
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