It's March 14, 2007, a year from now. What's your biggest, boldest, soothsayer of a prediction, so when we pull up this post, we'll all be amazed by your foresight, your brilliance?
Greenspan comes out of retirement to bail out Ben?
President Hastert enters 2008 race?
Housing prices increase 40%?
Gold hits $1000?
Britney divorces Kevin?
Dem-controlled house and senate brings impeachment charges?
Iran seen as beacon of democracy after peaceful coup?
Hidden Imam reappears?
Al Qaeda sets off nuke in DC?
Bird flu claims 1 million, devastating world economy?
Bush approval rating soars above 80%?
Take your shot.
Here's mine by the way (very predictable)...
Median US house price drops 15%, with #1 dropper Phoenix down 30%
March 14, 2006
Open thread for HP'ers: Make your boldest prediction here
Subscribe to:
Post Comments (Atom)
42 comments:
Housing will tank big time,of course. However we will all be too busy reading about the divorce of the year to notice. Big B dumps little (or is that unknown?)Kevin!Like everybody on the planet dosen't see that train wreck coming(the divorce,not the Housing Bubble,after all real estate only goes up,Ha Ha!!!). At least, with her money, it won't take long for her trainers to get those fantastic abs back in shape. I wonder if Mr. Nobody has a pre-nupt???? Anybody know how much THEY(yea,right)paid for her,oops,THEIR
house???_
Environment breakdown starts to become VERY evident. Housing prices fall, fall, fall. World spirals out of control...
BUT no one notices. Too many people with their heads up their posteriors...
After another a year of incredible home appreciation since Spring of 2006, home prices seem to be gaining momentum for another rise again. The 50 year loan is introduced making it easier for families to afford the new averge price of 742,000 for a home. Over 200 new bubble blogs have emerged to accomodate the newly created mass of renters that missed the wave again.
The worlds first 117 way tie for the Nobel Prize in Economics awarded to Ben, Keith, *me* [insert name here], et al.
By March of 2007 a mass decline of 50-70% in the number of real estate brokers and agents, as FSBOs and other alternative means finally hit the mainstream. New, progressive streamlined approaches make this possible, combining the internet with paper pusher firms, allowing anyone to sell their home for $300-500 with no hassle or extra legwork.
By 2011, the real estate sector meets its fate alongside the milkman, pony express carrier, blacksmith, and travel agents.
Americans House Rich,
Cash Poor.
Homebuilding stocks trading in the single digits.
Boldest and ultimate DOOM AND GLOOM PREDICTION:
BABY BOOM GENERATION'S equity collapses in a hideous deflationary depression set off by the collapse of the real estate market world wide and results in a tragic rebirth of antisemitism, class warfare, pestilence, strife, and results in a global dictator who outlaws the ownership of gold.
Even with the housing nay-sayers growing in numbers and hitting the mainstream media, I believe that the building industry will see its LARGEST AND BEST year in history in terms of output. The money is in the bank and the permits are approved. They gotta build.
And don't forget all of the bloated and fat levels of government that are already used to living HIGH-ON-THE-HOG on all those fees and taxes associated with house construction and home ownership! They are going to look the other way, adjust or repeal (or just plain ignore) zoning laws, whatever it takes, to keep the golden construction tax goose laying! God knows they are doing it around here!(central PA.) Houses and developements flying up already and its not even spring yet! Plenty of jobs for construction workers in all fields.
The home builders can cut their inflated prices tens of thousands, or sometimes even one hundred thousand or more and still turn a profit!
Now as far as real estate SALES,thats another topic completely. Who knows. Tank,flat line,inflate. it could still go any direction. At least there will be plenty of houses to choose from!
Dec 2006: Iran withdraws from nuclear Nonproliferation Treaty.
March 2007.
U.S. troops (exhausted and poorly supplied) in south-west Iran (near Kuwait, and where all the oil is) find themselves surprised to be losing against far more numerous and fresh Iranian regulars from the front, and the Sadr army from the rear cutting off their only port and supplies through Kuwait, and taking over the airfields.
With Blair having been ousted five months before, the new UK government has already withdrawn its troops from Shiite areas in southern Iraq and offers no cover.
Saudi Arabia, Kuwait, and Turkey refuse use of airfields to US; Iranian missiles keep aircraft carriers too far (and without big AWACS) to provide significant air-support.
After taking 6000 casualties in 3 weeks, including 1500 killed, Rumsfeld orders 6 5kt tactical nuclear weapons against Iranian troops surrounding cut-off marine division. There's little military change after Iranian reinforcement.
On the other hand, Turkey, Germany, France, Italy, Spain & Norway permanently abandon NATO.
No positive comments, I see.
TIMING is everything.... just when to short Homebuilders stocks ???
Just buy 2008 in the money puts and hold on for the ride down.
New article (Forbes):
The Last Speculators
Stephane Fitch 03.27.06
Condo flippers in south Florida will tell you that they are sure, real sure, that they will sell out at a profit.
Robert Jenkins, 30, found religion, quit his job as a disc jockey at a strip club and, in 2003, began speculating on real estate in hot-hot south Florida. He borrowed heavily and flipped 19 houses in Fort Lauderdale, reaping profits of $750 to $71,000 on each property and plowing two-thirds of his $300,000 in profits into still more homes. He now owns seven, worth $2.5 million and doubts a crash will happen. He vows to keep flipping, even if it does.
Donna Franklin, a 52-year-old former direct-mail publisher, owns five homes. Last year she and a partner borrowed against a Miami apartment they own and rent out to make down payments on three $400,000-plus “preconstruction” condos in Fort Lauderdale. They are confident they can flip the three condos at a nice markup soon--well before construction ends, at which point they must take mortgages for the $1 million they owe developers.
That could be wishful thinking. The number of unsold condos for sale in and near Miami has more than doubled from a year ago to 2,232, says Miami Realtor David Dweck. Foreclosures nationally are up 45% in a year and in Miami now occur at twice the national rate of one per 1,117 homes, according to RealtyTrac. Some 25,000 condos are under construction in the Miami-Dade area--more than the total number of purchases in the last nine years combined.
Three-fourths of those are in the hands of speculators, says Jack F. McCabe, a Deerfield Beach, Fla. consultant to developers. “The demand is artificial. Most south Florida speculators have been selling to other speculators,” he says. “It works fine--until you’re the greater fool and nobody else comes along to pay that higher price.”
Neither Jenkins nor Franklin paid much attention when the Commerce Department, on Feb. 27, said the supply of unsold, newly constructed homes across the country had ballooned to 528,000 in January, up 60% from the average from 1995 to 2004. Brisk sales of new homes have helped prices stay aloft, for now; sales are running at 1.2 million houses a year, 40% more than normal. But if rising mortgage rates cause sales to tumble to a normal pace, the effect on prices would be shattering. And in some parts of the country the last speculators--people like Jenkins and Franklin--would be in deep quicksand.
A correction may already be under way. The number of half-million-dollar-plus condos up for sale in Miami is twice the number in Los Angeles, whose population is four times as large. In New York prices reportedly slipped 13% last summer. In Las Vegas several developers have canceled projects amid soaring construction costs, spurring suits.
Condo prices in Florida have gone up 63% since 2002, and most speculators credit the state’s population growth--a thousand newcomers per day. Others credit the speculators themselves: Encino, Calif. real estate firm Marcus & Millichap says more than half the mortgages in Florida are high-spec in nature. The firm compared price appreciation to income growth in markets across the U.S. and fingered West Palm Beach, Fort Lauderdale and Miami as three of the five most vulnerable to a price correction.
Terrance and Jennifer Trott, both 26, describe themselves as “regular folks” who happen to own two homes. They grew up in New York’s Hudson River Valley and moved to Florida after Terrance finished active service in the U.S. Marine Corps in 2004. Last July they borrowed on their four-bedroom house near Tampa to pay $200,000 for a two-story condo in a development near downtown Tampa. They listed it at $235,000 in December. Two months later they dropped the price to $217,000 and are getting some bites.
The Trotts together earn about $85,000 a year, and the extra $22,000 a year it costs to carry their condo is a severe drain. “I drive a Kia that I’ve had since 1999 and it’s paid off, and we only go out to eat on the weekends, and it’s not every weekend,” Terrance Trott says. If the condo doesn’t sell, they may try to rent it out--just like everyone else; but even at $1,000 a month they would be pouring cash into the property.
In the aftermath of every crash come a few fearless souls, intent on making money on the misery of others. Jack McCabe, the Miami consultant, is raising a $250 million vulture fund to buy condos. He aims to pick up $1 billion of south Florida apartments on the cheap. Lenders are already offering him blocks of condos repossessed from distressed homeowners. “We’ll focus on buying million-dollar properties at 2003 prices-- at 70 cents on the dollar,” he says.
2007 in Point form:
Dem congress, senate or both.
Bush lame duck, Rove under microscope with Cheney VERY scared.
Congress becomes media focus.
Iraq civil war in full force followed by withdrawl based on Congress blocking financial bills for escalation (same as Korea, Vietnam).
China begins unloading dollar reserves to gold. Big dollar correction followed by big inflation. Savings of many wiped out but congress passes debt amnesty bill to save the asses of all the chumps too in debt to get out. Debt amnesty causes more dollar devaluation.
2008 and beyond:
As usual, choice of Dem or GOP president has no effect on anything though both camps continue to wage all out shouting match as if it mattered. Most Americans now work on black market and ignore politics due to increasing evident failure of systems concerned. Increased local manufacturing inside US with shrunken dollar. Walmarts close all over the place. People start walking to work. Winters are cold and hard but people come together and tough it out as they did pre1945. Natural move to simplicity corrects many social problems but many areas of country end up like wild west.
Rest of world in grips of resource wars. Population peaks then begins correction (gulp)...
Anon 4:53
This is all going to happen next year?
We've got some pretty pessimmistic people on this blog. Guys remember when all the computers in the world were suppossed to shutdown because of Y2k.
There will be a housing slowdown. It will take place over a few years. America always bounces back and we will this time too.
Y2K was a one-time event.
The current list of potential world-changing problems will take MUCH longer to sort themselves out.
The current levels of government and personal debt levels are not substainable. Global Warming has reached the tipping point. Peak oil production has been reached (since 2004) but demand is ever increasing. Religious strife is increasing...
People who lose sleep worrying about being devoured by the housing bubble may take some comfort from Henri Focillon’s “L’An mil”. In his book, Focillon points out that one thousand years ago, mankind was gripped by the same fears we face today. The phrase “Mundus senescit” or “the world grows old” reflected the prevailing mood of pessimism, as well as a religious conviction that the world had passed its peak and was about to die.
In the chapter “The Problem of the Terrors,” Focillon outlines the sources of The Terror as threefold: (i) that God would destroy his creation with fire and brimstone; (ii) the legions of the Devil would erupt from the East (iii) that plagues would wipe out the human race.
None of this happened of course. The Terror passed and a new mood of optimism moved Bishop Glaber to write: “The earth was covered with a white robe of churches.”
10% median home price decline, 40% in the overheated markets (phoenix, san diego, etc).
Gold at $1,150 and rising
Iran opens its oil Buorse to trade oil in euros causing the US to attack them under the pretext of Iran trying to create nuclear weapons. (even though no evidence will ever be provided... the bush administration will insist that Iran Proves they are not creating weapons... and proving a negative is nearly impossible)
After the US/Israeli attack on Iran, all hell breaks loose in the region. Oil will increase to $100+ a barrel.
China starts unloading dollars (to slow the US’s imperialistic crusade against ‘terror’ that these wars are creating) causing the valued of the dollar to go down... soon, other central banks take notice and start dropping the dollar also... leading to massive economic problems in the US
The fed will be presented with a choice, raise interest rates (a lot! Like 1980’s 18%) causing the economy to deflate, or they will turn on the printing presses and we will inflate. The new fed chef is a scholar of the great depression, and his personal opinion seems to be that inflation would be good in that situation. In the worse case, we could have huge amounts of inflation, basically wiping out everyone with savings (think about all the boomers getting ready to retire).
Pessimistic or pragmatic... or both… time will tell. I hope I’m wrong.
Another year down the road... bush declares a state of emergency. Use a presidential executive order to confiscate all gold (just like FDR did in 1933).
Greenspan chokes on a frothy latter, but recovers thanks to quick use of an ARM.
Housing slowing deflating for years, no more spending, gold below $300, oil below $40/barrel, Muslims and US suckers, I mean soldiers fight for no purpose.
Housing slowly deflating for years, no more spending, gold below $300, oil below $40/barrel, Muslims and US suckers, I mean soldiers fight for no purpose.
The last half of this decade will be a lot like the first half of the '70s. If you're too young to remember those times, ask someone to fill you in.
The Dems are going to win Congress back, and they will immediately start picking the pockets of working Americans to pay for the ones who can't be bothered. Emigration will become a hot topic as the rich and not-so-rich flee the U.S. for other countries.
House prices will take a 20%-40% dive before inflation kicks in and they head back up. Average people will own $500K houses and pay $6 a gallon for gasoline by 2010.
Mega subduction earthquake 9.5 on Richter scale slams into the West Coast followed by huge Tsunamis from California to Washington. The housing market along with the coastline collapses into the sea. A stunned President Hillary Clinton recoils at the magnatude of the disaster into the fetal position in the oval office where she is found ten days later still hunched over in tears crying WHY WHY WHY
A category 3 or 4 hurricane will hit the west coast of Florida in Sept-Oct and local real estate prices there will plunge 20%. Nationwide, housing will drop 4%, with 8% and 12% drops in California and MA, respectively, and the NAR will blame the hurricane for the 'temporary slowdown.' The Fed will have tightened to 5.75, the Chinese will have stopped agressively buying the 10-year treasuries, and the major stock indices will be 20% off 2006 highs and layoffs will be common and signs of recession will be abundant. Americans will be too distracted by economic worries to notice the 87 outrageous criminal acts perpetrated by Bu$hco that will come to light in 2006.
Hillary Clinton is elected president and Bill Clinton becomes the 1st lady.
Taxes are raised to a flat 45%.
Home loan rates near four-year high, demand falls
NEW YORK (Reuters) — Mortgage applications fell last week, reflecting lower demand for home refinancing as interest rates on long-term loans surged to a near four-year high, an industry trade group said Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended March 10 decreased to 574.4 from the previous week's 575.6.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.42%, up 0.11 percentage point from the previous week, its highest level since the week ended July 5, 2002, when it reached 6.46%.
"Seasonal factors are rising and we are entering the peak home buying season of spring, which is probably why higher rates did not have a larger impact on loan demand," said Douglas Duncan, chief economist at the MBA.
The 30-year fixed-rate mortgage, the industry benchmark, was also substantially above its 2005 low of 5.47% in late June of 2005 as well as last year's high of 6.33% in the week of Nov. 11.
The group's seasonally adjusted index of refinancing applications decreased 1.9% to 1,583.6. A year earlier the index stood at 2,267.5.
The MBA's seasonally adjusted purchase mortgage index rose 1.0% to 403.0. The index, considered a timely gauge of U.S. home sales, was below its year-ago level of 462.8.
Historically low mortgage rates have fueled a five-year housing boom, helping support the U.S. economy's recovery from recession despite uncertain business investment.
Higher interest rates may have finally cooled the housing sector, but the MBA's Duncan is not expecting a crash.
"What we are seeing is an orderly slowing of the marketplace," he said.
Fixed 15-year mortgage rates averaged 6.06%, up from 5.97% the previous week. Rates on one-year adjustable-rate mortgages (ARMs) decreased to 5.64% from 5.69%.
The MBA's survey covers about 50% of all retail residential mortgage originations. Respondents include mortgage bankers, commercial banks and thrifts.
(http://www.usatoday.com/money/economy/housing/2006-03-15-home-loans_x.htm)
I posted my thoughts on housing forecasts in a comment on another blog. It's too long to repost here (I had seen one too many housing forecasts and went off on a lenghty rant).
http://blogs.ocregister.com/lansner/archives/2006/03/oc_runs_with_so_cal_pack_1.html#comments
See Comment: FUN WITH NUMBERS: How to Forecast the Hosing Market Like a Pro.
I predict Keith marries a man in England.
How about a realistic prediction? Not much of anything will happen. The 5-year recession will continue, but the govt. will report 2.5% growth. Republicans will hold Congress. House prices remain flat nationwide. Oil prices will stay around $60 barrel. Gold will fall slightly. Dems will blame George Bush for everything. Britney will continue to put on weight, eventually reach critical mass and implode in a burst of bright light.
Soilent Green is made of PEOPLE!!!!
PeOpLe!!!!
I agree with Cereal...it will be total chaos...............the nwo are coming upon us.....
"The last half of this decade will be a lot like the first half of the '70s. If you're too young to remember those times, ask someone to fill you in.
The Dems are going to win Congress back, and they will immediately start picking the pockets of working Americans to pay for the ones who can't be bothered. Emigration will become a hot topic as the rich and not-so-rich flee the U.S. for other countries.
House prices will take a 20%-40% dive before inflation kicks in and they head back up. Average people will own $500K houses and pay $6 a gallon for gasoline by 2010. "
SOLD! no one is fleeing for other countries...errr except for the tool who writes this blog. Dems are NOT winning back the congress, and of course not winning in 08'. Dream on left wing man. Sorry, but the top marginal Fed tax rate is going to 31% sucka. Supply side wins, pay me.
My prediction for the coming year is that things stay largely the same. Real Estate will go up in most places. No housing crash in the next 12 months. I have been reading about this supposed crash for 5 years now. It has not happened. No reason to think it will in the next 12 months.
Que Sera Sera
Whatever wil be will be
The future is not ours to see
Que Sera Sera
I have been following a site now for almost 2 years and I have found it to be both reliable and profitable. They post daily and their stock trades have been beating
the indexes easily.
Take a look at Wallstreetwinnersonline.com
RickJ
Hello Friend! I just came across your blog and wanted to
drop you a note telling you how impressed I was with
the information you have posted here.
Keep up the great work, you are providing a great resource on the Internet here!
If you have a moment, please make a visit to my arizona real estate mortgage site.
Good luck in your endeavors!
Hey Fellow, you have a top-notch blog here!
If you have a moment, please have a look at my tomy toys war pig dog site.
Good luck!
Hi Blogger, I found your blog quite informative.
I just came across your blog and wanted to
drop you a note telling you how impressed I was with it.
I give you my best wishes for your future endeavors.
If you have a moment, please visit my tomy baby toys site.
Have a great week!
Post a Comment