Just in case you thought the housing market wasn't bad enough already, Barry Ritholtz believes...

Just in case you thought the housing market wasn't bad enough already, Barry Ritholtz believes home prices are still too high and will sink below historic levels. "Without the heavy hand of the government intervening, the residential real estate market is about to experience what price discovery [through basic supply and demand] is all about."

Comments (16)
  • nightfly
    , contributor
    Comments (1015) | Send Message
    Thanks Obama! Instead of allowing the pain and problems to just be dealt with and washed out to sea, we get to experience a slightly less painful version much much longer!
    24 Jun 2010, 03:22 PM Reply Like
  • bbro
    , contributor
    Comments (11223) | Send Message
    Use of apples and oranges...median household income is relevant towards renting..use median family income versus existing home
    not new home....using skewed data on both sides to buttress an argument....
    24 Jun 2010, 03:26 PM Reply Like
  • gtittle
    , contributor
    Comment (1) | Send Message
    I have deliberately rented for years based on the fact that rental versus purchase hasn't and still doesn't balance out in favor of purchase.
    24 Jun 2010, 03:30 PM Reply Like
  • TXBankingExec
    , contributor
    Comments (123) | Send Message
    Depends entirely on where you live but in many cases, you are absolutely correct.
    24 Jun 2010, 03:36 PM Reply Like
  • dfbell
    , contributor
    Comments (1462) | Send Message
    Me too. Moved in 2002 and decided not to buy as I thought about moving again to south beach. Got the first part right but stalled out on the second.
    24 Jun 2010, 03:48 PM Reply Like
  • DaJoker
    , contributor
    Comments (106) | Send Message
    It's hard to own a decent home in city burbs (places that would normally desirable) without two 6 fig incomes. Sure you can buy with less income, you'll also be living pay check to pay check
    24 Jun 2010, 03:39 PM Reply Like
  • TXBankingExec
    , contributor
    Comments (123) | Send Message
    Again, it depends entirely on what city you are talking about.
    24 Jun 2010, 03:42 PM Reply Like
  • User 281898
    , contributor
    Comments (46) | Send Message
    Barry also thinks BP is a "value play". Whatever
    24 Jun 2010, 03:41 PM Reply Like
  • j_remington
    , contributor
    Comments (1341) | Send Message
    Obama Geithner about to announce another incentive to buy homes! They can't stop and let it flush, not after all that has been done.
    24 Jun 2010, 03:42 PM Reply Like
  • dfbell
    , contributor
    Comments (1462) | Send Message
    Will congress fork over the money?
    (shaking 8-ball)
    ● Concentrate and ask again
    24 Jun 2010, 03:51 PM Reply Like
  • Duude
    , contributor
    Comments (3413) | Send Message
    The heavy hand of the government only delays the inevitable, and at a cost to future generations. Its a negative, negative. Nevertheless, with elections approaching I fully expect Congress will add more wet wood to the smoking logs.
    24 Jun 2010, 03:50 PM Reply Like
  • bbro
    , contributor
    Comments (11223) | Send Message
    Another piece of data for the chart presented... 30 year mortgage rate
    averaged 9.98 % over the period of 1977 to 2002....
    24 Jun 2010, 03:58 PM Reply Like
  • Econdoc
    , contributor
    Comments (2938) | Send Message
    Correct. It is ridiculous what passes for analysis in some places.


    If mortgage rates halve - affordability will move accordingly.


    In fact affordabiity is at 18 year highs - see here.




    It is just misleading to look at the data in the way he is looking at it. What possible motiviation could he have?


    25 Jun 2010, 12:07 AM Reply Like
  • Ranni
    , contributor
    Comments (157) | Send Message
    Like bbro pointed out, mortgage rates are half what we have seen those comparable periods.


    Also after long recession, household incomes tend to rise, which should also limit downside going forward. Barry simply cannot look those fancy charts, and declare, how housing is going to take next step down. There is much more moving parts.


    If one would wait, mean to revision (81-87 levels) after 1990 recession, he would be still waiting after 2 decades.


    Rtiholtz’s analysis is flawed.
    25 Jun 2010, 04:32 AM Reply Like
  • User 487974
    , contributor
    Comments (1101) | Send Message
    "Double snaps" to Barry. Always wanted to use the snaps thing, Guy Adami getting some snaps today..But to the point, agree with all said. My 2 cents on this is simple, try/do live below your means. Yeah, it sounds weird and easy. Its not going to be easy for 99.9% of Americans. We/you can do this or the depression{look at fin.reg.}and bad policies will do it for us. Depression is a cleansing process Summers/Geithner and slow on the uptake,Bernanke just can't fathom. They are responsible for it,by trying so hard to avoid it. In 2000,if Greenspan just let the market clear,we would have had a rough few years{9/11}would have compounded it,but we as a country would probably be out the other end by now. But these brain surgeons just had to play God, now we are going to pay for it. Sad/disturbing thing is these same fools are trying to keep this insanity going. I applaud the Euro zone, for at least talking tough. If they go through with the austerity/pain, I will tip my hat...
    24 Jun 2010, 06:24 PM Reply Like
  • History Buff 24/7
    , contributor
    Comments (415) | Send Message
    The government and the Fed will stop at nothing to keep housing prices from tumbling farther, even if it means wrecking the economy with more and more outrageous deficits and debt. Having allowed and even encouraged the creation of the bubble (for various reasons, which we won't get into right now) they are unwilling/unable to let nature take its course and allow the invisible hand of the market to bring prices to their natural level.


    The housing market is calling Ben's bluff. Let's see who holds and who folds.
    24 Jun 2010, 11:00 PM Reply Like
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