Mike Mosieur

Housing: What Does "Return to Mean" Really Mean?

Tim

I think you are right on the money, except real appreciation is in the 3% per year range, just a little ahead of inflation. Pheonix may be the exception.

You are correct when you point out that no one seems to be considering RTM, a basic economic principle. In fact this is the first time I've seen an article on it.

I live in Central Florida, or "Bubble Central" I figure a house that sold for $100,000 in 2000 is now worth $120,000 to $123,000 today, 2006. Presantly that house is priced at 180,000 to 200,000 so we have a 30 to 40% decline ahead. RTM is like gravity. What goes up (or down) will eventuality return to the mean.