Misled Inamerica

Median Housing Prices Poised to Fall Back Below $200K

Unemployment is skyrocketing. It will go from around 4% at the RE peak to in the neighborhood of 10% by the end of 2009. And this is the government number. It doesn't include those that have stopped looking and the highly skilled workers that in desperation end up working part-time at Walmart. Real unemployment has already climbed to over 11%. The destruction of so many jobs will drop the average household income by a considerable amount.

Also, why use a multiple of 3.5x household. When massive bubbles burst they don't calmly settle back down to higher than the historic average. They OVERSHOOT. Remember that word because you'll hear it more and more in the future. The rate that RE is dropping is still increasing. If we only drop another 25% from hear we will be lucky. Look for a median house price of around 120,000 to 140,000 sometime in 2011 or 2012.