July 26, 2007

Housing Speculation - it happened around the world. Now we pay the price.

The US housing market is crashing in such a fantastic and historic way, you'd think nobody could top it.


Just wait. The Brits ("get on the housing ladder!") were even more housing-speculation obsessed than the Americans. And they polluted all of Western and Eastern Europe with their get-rich-quick schemes.

But now, the Great European Housing Crash begins.

It's strange moving from US-housing-bubble-central Arizona to Worldwide-housing-bubble-central England. If only you could see what I've seen.

You live in historic times HP'ers. Tulip Bubble, South Sea Bubble, NASDAQ Bubble, Worldwide Housing Bubble. This one will be studied for thousands of years.

Oh, the folly of man. Will we never learn?

21 comments:

Anonymous said...

"You live in historic times HP'ers. Tulip Bubble, South Sea Bubble, NASDAQ Bubble, Worldwide Housing Bubble. This one will be studied for thousands of years.

Oh, the folly of man. Will we never learn?"

Um yeah about that, delusional much?

Anonymous said...

No more bubbles

Anonymous said...

I'm having fun!!! Of course I'm in the stock market (short).

keith said...

The only way for "The Property Ladder" to be relegated to the dustbin of history is for housing prices to crash

I never want to see that term again. It's disgusting.

Might as well say "The Ponzi Scheme"

It's amazing that so many Brits fell for it

Anonymous said...

The property ladder works fine in an inflationary (post-1973) economy. Just don't take your next step on the ladder near the end of a price run-up, which happens every 13 years or so. If people are lining up for condos then it's time to be conservative (no home equity withdrawal, no renovations, no trading up to a bigger house).

The REALLY scary part for ladder-climbers is: what if demographics cause a deflationary economy, as in Japan? What if home prices go down slowly for 15 years? This is the HS Dent theory - see hsdent.com

keith said...

Ireland, Spain, England, France and even the Eastern Europeans are going to collapse or are collapsing

It was all British hot money spreading around Europe on 2nd homes (and 3rd and 4th and 5th and 6th..). Rents barely kept up with incomes, while home prices soared, becoming detached from the ability of people to pay or having any relationship to rents

It's the P/E stupid.

It'lll always be the P/E stupid.

Anonymous said...

It's not just P/E Keith,
It's P/E, Supply and demand.
based on P/E the San francisco bay Area should have run out of steam 20 years ago. The lack of new supply has kept prices high and higher, and there is enough demand to support the price gains.

Based on P/E the bay Area is due for a 50% price drop. You telling me that is coming?

Yeah, right.

Anonymous said...

r/e will crash then next bubble prices will be twice what they are today.

Anonymous said...

http://atlanta.craigslist.org/apa/380494511.html

Rent: $1,495/month
Deposit: $1495.00
For sale @ $229,900

$0 down $229K at 6.5% is $1450, less than rent. From that, take away $300 in tax deduction, $200 in principle payback and the next cost is $950. Tax and insurance adds another $200 for a grand total of $1150.

Now please someone explain to me why renting is always better again...

Anonymous said...

CBS Marketwatch headlines:

"Bears trample the markets
Dow and S&P end 2.3% lower; Nasdaq down 1.8%"

However, iPhones are selling like hotcakes and the economy is just booming so none of this really matters. And most likely, it's just the tin foil hat wearing dopes living in their parent's basements that are selling off their stocks that is causing this correction. In other news, did you hear the latest about Lohan?

borkafatty said...

Oh, the folly of man. Will we never learn?"

Um yeah about that, delusional much?

--------------

NYUK! NYUK! NYUK!

Anonymous said...

I agree with you Keith they will study this one the same as the Tulip craze. I was driving around this Spring and saw a house for sale with a ton of Tulips in the garden. I wish I would have had my camera with me. It would have made a great photo for your site.

Sequoia512

Joe Logic said...

Get ready to spit your drink through your nose with laughter:

www.righttimetobuy.org

They're running spots on TV every 10 mins. Some drunk sorority girl passing herself off as a career woman telling her husband (in a less suzannish way) it's "time to buy", and the dude looks like he needs to get laid so he's going along. If anyone finds this on YouTube please post here.

Anonymous said...

You may not like today’s pricing, but you will like tomorrow’s even less

Al said...

will they ever learn.

no.

1. kondratieff wave 60 year cycles.
2. this generations lessons are forgotten by the grandchildren.

3. as we have forgotten the lessons our granparents (who grew up in the depression never forgot)

it will be 60 years before this is repeated. it will take that long for this generation to die off.

assuming they make it that long and the "global warming", or the peak oil, or the "insert your calamity here" does not get them first.

the only thing we learn from history is that we dont learn from history.

wash, rinse, repeat.

Anonymous said...

www.righttimetobuy.org

HAHAHA...I saw that commercial tonight and then when I saw that it was the Master Builders Association I had to laugh.

Keith...you need to get a link to that 30 second "gem".

Anonymous said...

Vanity of Vanities, all is vanity!

dommidge said...


Anonymous said...

Now please someone explain to me why renting is always better again...

July 26, 2007 10:38 PM


In 2 years when that home is worth 150k (conservatively) It will have cost you a lot (5k a month) more than your 1150 guestimate.

Jog On.

Anonymous said...

Anonymous said...
It's not just P/E Keith,
It's P/E, Supply and demand.
based on P/E the San francisco bay Area should have run out of steam 20 years ago. The lack of new supply has kept prices high and higher, and there is enough demand to support the price gains.

Based on P/E the bay Area is due for a 50% price drop. You telling me that is coming?

Yeah, right.

July 26, 2007 9:55 PM

-------------------

Actually, I'd be surprised if Mexifornia "only" drops by 50% by the time it's all said and done. That includes, SD, LA-la land, and, yes, the Bay Area. Who will pay outrageous prices for a "starter home" once most of the tech jobs have been offshored to India?

Anonymous said...

Anonymous said...
r/e will crash then next bubble prices will be twice what they are today.

July 26, 2007 9:59 PM

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In nominal dollars, quite likely. Heck, there might be enough inflation for the next RE peak's prices to be 10 or 20 times what they are now.

In real money terms, no. Not even close.

Understand this: in real money terms, homes in the bubble areas (e.g., CA, FL, etc.) will NEVER AGAIN be anywhere near their 2004-2006 price levels.

Daniel said...

Any tips on what stocks to short to take advantage of the coming housing crash in England?