total implosion of the u.s. real estate market

Discussion in 'Economics' started by the gardner, Oct 23, 2007.

  1. Adobian


    The fire in Southern California will kill the real estate market there. I feel sory for both those who have lost their homes in the fire and those who haven't.
    #21     Oct 23, 2007
  2. I don't have a view on when or how much (in either direction).

    What I do have a view on is statistics. 24 years is not a long time in the slower markets (or maybe any markets) so just because someone hasn't seen something in their 24 years doesn't mean it won't happen.

    Its like the 100 year floods and droughts we've been getting. Damn ... how come we can get one each year?
    #22     Oct 23, 2007
  3. Cutten


    Last time I checked, dozens of RE stocks have gone bankrupt, and almost all are down 50-95% from their highs. If that isn't a stock market apocalypse, what is?

    See, this is a trader's site. We are more concerned with what is going to happen to the prices of stocks, since that's what we trade - we don't trade GDP, foreclosure rates, or canned food prices. As of now, short real estate stocks has been the biggest bonanza of a one-way bet since the collapse.

    The gracious thing for you real estate bulls to do would be to admit you were flat out wrong. Admit that you were long and wrong into the biggest real estate bear market since the Great Depression 75 years ago. Then at least you could keep your dignity. Trying to pretend it's not a big deal just looks pathetic, at this late date.
    #23     Oct 23, 2007
  4. Cutten


    Look at the stock prices, for crying out loud. Real estate stocks have been TOTALLY F*CKING MASSACRED. Shorts have made absolute killings. Some of my puts have gone up over 50 fold this year, this has been the most profitable one-way trade I and many others have done for several years.

    How the hell can you say it's anything other than a total bloodbath? Stock market annihilations like this happen once every 5 years, it's not a common event. To try to dismiss it is just beyond moronic.
    #24     Oct 23, 2007
  5. You're talking apples vs. oranges, Cutten. Yes homebuilders have been annihilated and yes prices of NEW construction homes are plummeting. However the woes of those in Imperial Valley are having ZERO effect on prices in Santa Monica. In Manhattan prices are up on the year and the median condo value is now over 800k. Hence looking forward is not the easiest of tasks.

    When you see the dollar on 40 year lows, Gold, oil and stocks on all time highs with Bond yields at 4 and a frickin half percent then YOU KNOW that real estate values are not exactly collapsing.

    I follow SoFla like a hawk. I'm clueless. Prices in shit areas are weak (borrowers can't qualify and folks with $ wouldn't live there) yet homes in solid neighborhoods are almost drifting back to the 2005 highs.

    Personally I think we're at the top of the asset cycle but in my near half century on this earth I've never seen a smash without rising rates as the catalyst. Interest rates reach beyond borrowing costs. Rates also effect the mindset of cash buyers vis a vis utility. If you tell a rich guy that 1mil will give him a lousy 30k a year income (these days literally "walking around" money) or for a mil he can buy a condo in South Beach then the equation takes on a new dynamic. Not to mention this novel concept, people actually enjoy spending money.

    Let's face it, we have a depreciating currency that pays you a negative real rate of return. What would you do with access cash?
    #25     Oct 23, 2007
  6. There is a huge diff between builders and homeowners
    #26     Oct 23, 2007
  7. Well, that is convincing...
    #27     Oct 23, 2007
  8. All of the doomsayers have a horrible track record... over the last 100 years I'm sure people that predicted panics and crashes were wrong 98% of the time. A bet against the US economy is a bad bet.
    #28     Oct 23, 2007
  9. I dont know about florida, but Hinsdale is a disaster. Its the jumbo and alt a market that is silly overvalued. The affluent are taking big hits.
    #29     Oct 23, 2007
  10. homeowner's balance sheets are kinda bloody
    #30     Oct 23, 2007