Seeking Alpha

Housing prices have bottomed, says Bill McBride, one of the keener observers of the market. Key...

Housing prices have bottomed, says Bill McBride, one of the keener observers of the market. Key to his reasoning is the normalization of the price/rent ratio and a large decline in listed inventory. Don't look for increases yet, however, as he expects prices could move sideways from here for several years.
Comments (4)
  • Conventional Wisdumb
    , contributor
    Comments (1802) | Send Message
    It pays to actually read the article because the above is a little ambiguous.


    Key comment:


    "For the economy and jobs, the bottom for housing starts and new home sales is more important than the bottom for prices. However individual homeowners and potential home buyers are naturally more interested in prices. So when we discuss a “bottom” for housing, we need to be clear on what we mean.
    For new home sales and housing starts, it appears the bottom is in, and I expect an increase in both starts and sales in 2012."
    6 Feb 2012, 03:13 PM Reply Like
  • 7footMoose
    , contributor
    Comments (2266) | Send Message
    I wish Bill luck in his prediction but I personally do not think there is much hope he is correct. In some isolated markets he will be right but overall I think he is wrong. I use California as a bell weather. It is Greece disguised in board shorts. All of those retirees from California are migrating to other more fiscally responsible states and have been doing so for years. These individual's pensions and health care benefits are bankrupting cities throughout the state of California and other states are reaping the benefit of their spending. Now we are seeing the exodus of more prominent names who are selling their expensive Beverly Hills homes often at a loss and moving to other more taxpayer friendly states. Wealth has mobility and poverty has roots.
    6 Feb 2012, 03:18 PM Reply Like
  • 2PP
    , contributor
    Comments (354) | Send Message
    The only reason home prices have stopped their decline is the banks are holding excess REO inventory off the market. They can't hold them forever without a substantial markdown in value, and when they let loose it will restart the decline or prolong the sideways movement. Flush them out now and let the market begin to heal sooner than later.
    6 Feb 2012, 03:18 PM Reply Like
  • Josh ODonnell
    , contributor
    Comments (229) | Send Message
    Highly doubt that... Especially when just last month case shiller reported a 1.3% decline in home prices(after 4 years of recession...thats still bad)...Home prices aren't going up anytime soon...
    6 Feb 2012, 05:01 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs