John Doyle

Housing: Too Much Cash Waiting for Investment for the Market to Fall Sharply

Quote: "As a result of the utility value of real estate and houses, REOFs and thousands of individual investors waiting for a decline in housing prices, I can't foresee a 1929-style stock market crash hitting the housing market. Watching housing prices fall 50% or more in a few months or over a few years is simply not going to happen.

Granted, we may be in for a correction of 10-15% in housing and real estate prices over the next year or so, but there is too much capital waiting on the sidelines for housing prices to fall much further than that. Just look at the history of real estate: When housing prices fall, a lot of buyers come out of the woodwork to buy up the properties with depressed prices."

My best guess is prices will fall 25-30% at least.

Do you realise how many home owners will then be under water?

Have you considered the "ARMS" resets that are to come in the next 2 years?

This current real estate boom is global, and is the biggest boom the world has ever seen (refer "the economist" publication)

I shudder to think what could happen to institutions that hold the mortgage paper.

Oh well, we'll see.........I'll just keep liquid until we get near the bottom in 3 to 4 years time.

I'll e-mail you again then and compare notes.

Kind regards