You are invited to predict future real home prices -- I show the past

[Ed]

The past is shown up-to-date in the first and last charts here:
“Real Dow & Real Homes & Personal Saving & Debt Burden” at
http://homepage.mac.com/ttsmyf/RD_RJShomes_PSav.html

I refer to the last chart, and to the three real S&P/Case-Shiller Home Price Indices therein -- data are described at bottom of the page.

FYI, I don’t predict, but I do show the past SOUNDLY.

[renewable]

Re: You are invited to predict future real home prices -- I show the past

Here's a different way of looking at US house prices, from 1890 to present:

Real Estate Roller Coaster: http://video.google.com/videoplay?do...99799528285056

Data is from inflation adjusted Shiller graph: http://www.speculativebubble.com/images/homevalues1.gif

[Jeff]

Re: You are invited to predict future real home prices -- I show the past

I'll bite. Including the overshoot on the way down, prices from peak will have fallen 60% by 2014 when they flatten out.

[FRED]

Re: You are invited to predict future real home prices -- I show the past

I'll bite. Including the overshoot on the way down, prices from peak will have fallen 60% by 2014 when they flatten out.

Feb. 2008 Harper's prediction: 38% correction plus approximate 5% overshoot between 2012 and 2013.

Jan. 2005 iTulip forecast: Home prices bottom in 2015.

[jimmygu3]

Re: You are invited to predict future real home prices -- I show the past

OK, guess I'm the contrarian among contrarians but I think inflation, currently running in the double digits, will do most of the work and that the nominal bottom will come in 2009. I predict that by this time next year, the SPCS20R will have declined 22% from its nominal peak of $206.52 in 7/06 down to around $160. Inflation will have driven rents up, and price-to-rent ratios will be back in line with historical norms. Dollar repatriation will help bid up the price of dollar-denominated assets, as well as dollar-denominated wages. I'm not as concerned with the "real" bottom, as I think we'll see a flattening out of real home prices as nominal prices begin following inflation upward. The nominal bottom is more important for getting the real estate market moving again, and I think we'll see it in '09. Get your checkbooks ready. ;)

Jimmy

[ax]

Re: You are invited to predict future real home prices -- I show the past

I am now getting direct mail to participate in housing auctions, "$300K below purchase price OBO!" I think 2009 is a bit ambitious for a bottom. This type of desperation is far from the end of things to come...

[Ed]

Re: You are invited to predict future real home prices -- I show you the past

Just to be sure this is known: I use CPI-U for inflation-adjustment, and its last 12 month change was +4.0%.

[Guest]

Re: You are invited to predict future real home prices -- I show the past

... I think inflation, currently running in the double digits, will do most of the work and that the nominal bottom will come in 2009. ... The nominal bottom is more important for getting the real estate market moving again, and I think we'll see it in '09. Get your checkbooks ready. ;) Jimmy

Ya. What jimmygu3 said.

[jimmygu3]

Re: You are invited to predict future real home prices -- I show you the past

Just to be sure this is known: I use CPI-U for inflation-adjustment, and its last 12 month change was +4.0%.

Using the pre-1980 methodology, shadowstats.com shows CPI to be just under +12%.