How will we know when we've hit bottom?
When do you think that'll be?
March 21, 2008
HousingPANIC Stupid Question of the Day
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51 comments:
The usual sign.
Despair, capitualation, desponsency, hopelessness.
Keith, with *that* pic, I think you've already answered the question :)
Happy Easter! Enjoy it - it's probably going to be the last one...
We will have hit bottom when I purchase a SFH here in Seattle. We have a long way to go down from here. RE agents are currently doing "short sales"; we have not reached the point of massive waves of REOs like California.
We will.
Hey, I found a new bubble fence in Belltown here yesterday. 10 lockboxes!
http://deflationland.blogspot.com
With the Fed's strategy of reflation, we might have seen close to a stock market bottom already but I wouldn't expect much growth either. Who wants to invest in a complete scam? The new reality will take ten years for people to get used to. Japan is a great example of how you can completely screw your free market long term. No growth in the markets there for 10 years because of bailouts of crap banks and low interest rates.
CRUISING, IN MY SUV!!!
BOUGHT THIS RIDE WITH SOME FAKE EQUITY!!!
JINGLE, JINGLE, BABY!!!
TAKE THIS HOME, TAKE THIS HOME!!!
DOPES!!!
Dude thanks for that pic. Made my day.
When? who the hell knows. The way the government is spending money propping it up, could be 6 months, could be 6 years, could be never before they give up and let market forces prevail.
Right now the Realtors in my town are making $$$ hand over fist selling the REO's...
And for the gold lovers:
"Gold had its biggest weekly loss since August 1990 after reaching a record $1,033.90 an ounce on March 17. Oil plunged almost $10 over three days, after rallying to $111.80 a barrel, the highest ever. Corn dropped more than 9 percent for the week, the most since July. "
DOPES!
When 3 or more of the following: TOL, BZH, HOV, SPF, LEN, DHI and RYL file for bankruptcy protection, then I'll start believing we've bottomed.
Unsold inventory of houses starts going down instead of up.
Still too many homebuilders out there building too many homes.
I thought that brotha was delivering pizza these days, Oops my bad! He's selling real asstate.
When hundreds of thousands of REO and foreclosed homes have squatters living in them for free because nobody has money to buy them and the banks are unable to enforce eviction because theirs just too damn many of them. That will be a good indicator.
When lawrence yun is taken away in hadcuffs to be angelo mozillos new bed bud in san quentin.All hp'ers can then send them lots of lube paid for by casey serins google monies.
We'll know we've hit bottom when there's many vacant homes in older stablished neighborhoods, and the entire area looks run down.
That will be the time to buy.
Friend in Orlando just listed his house and had an offer in 4 days. I guess there will always be exceptions.
.
DAMN IT!
You can not call Bottom til you know how far you have to fall!
You get there when you get there!
I also believe this bottom is getting deeper!
.
Great picture Keith. Dosn't get much worse than the Ice man! And he was once "hot", OMG!
With our unbelievably incompetent and corrupt government, on both sides, throwing our money at the problem, we will hit bottom when we can look back about 10 years and say: We hit (past tense) bottom back in (fill in date here,) not until.
With all the economy propping up going on now, any logical future financial predicting/planning is a crapshoot!
To borrow from Paddy, invest in "fast cars, georgeous hookers, and fine old Irish wiskey, ......and the rest of the money I'd waste."
The bottom to all this will be when all of Europe along with its evil inhabitants are burned to the ground, and an ancient tribe re-inhabits the land.
Right around the corner, yup yup
"Americans confident in 2009 turnaround"
http://tinyurl.com/2q45rf
We will have hit rock bottom when nobody, and I mean nobody wants to buy a house because they won't have any money. The bush built scheitt sandwich will take DECADES TO PLAY OUT. Pehaps a generation or two.
You see in 2002 we were headed for a nice sized depression, and then team bush built on that by encouraging easy lending. Consequences be damned.
bottom of what, home prices or stocks?
I think we still have a ways to go.
I think anybody who thinks we're anywhere near a bottom is a total dipshit fool. Anyone looked at the Case Schiller graph lately? Do you see how much further the bubble needs to fall before we reach the norm? The bubble has to completely deflate because there is no more phony loan products to support it, the cost of ownership is way up and there's way too much supply.
On top of that we've only seen the first of the mortgage reset waves of foreclosures. There was a great post on the Irvine Housing Bubble Blog that explained how there is a lag of up to 12 months before mortgage resets result in foreclosures:
http://www.irvinehousingblog.com/2008/03/01/wot-3-1-2008/
I think we've entered the denial stage thanks to B-52 Bernanke's loose money tonic. Don't buy into this fool's rally.
When I buy my home in Orange County, CA with ease given the median annual earnings of $75K per year, then we'll have hit whale shit bottom.
Until then, it's rock and roll all nightand foreclose every day!
When all the failed flippers and bankrupt boomers are rounded up and placed in FEMA camps - that I believe will be the sign of hitting bottom, Weimar style.
Can someone please explain why Lehman (LEH) skyrocketed on Thursday?
They had to tap the FED's new "banker buddy bailout" loan window just to survive.
Since when is the need to borrow emergency funds to keep afloat, a good sign? Isn't a lack of sufficiant funds to run a business a bad sign?
We can't possibly spot the bottom because the market does not make sense.
the bottom is...
when the Time "Housing Bust" magazine cover hits.
We'll hit bottom when the housing P/E and CAP Rates make sense, as well as the 10-year Treasury Note goes up. Until then, the Wall Street crooks can fake as many rallies as they want.
Friend in Orlando just listed his house and had an offer in 4 days. I guess there will always be exceptions.
I saw 5 people lined up to buy Krispy Kreme doughnuts. Recession must be over.
DOPES!
2024 Armageddon baybee!
When home prices don't move at all for 2-3 years.
When you begin to see open sores on the bottom of those real estate agents who are still out there babysitting homes nobody wants.
The more sores you see on those red cheeks the nearest you are to a bottom!
MAX
You've got to read this article about Lehman Bros. (LEH). It's the perfect bubble/scam/lies Wall Street story. Lehman would be in the same boat as Bear Stearns if not for the lies about their earnings and writedowns.
Also S&P chose today to downgrade Lehman.
I think the bottom was around the end of 2005 when the degradation reached a peak. People just grabbed their plastic cards and took off on the "Who can spent more than Bil Gates for a couple of years!". Too busy buying crap they don't need and barely holds their attention to the next binge of buying even more and better crap they don't need. Well, now maybe I can play Monopoly with someone not busy shoppin', shnortin', or vacationin' in Europe, or working and driving their a** off 24/7 busy makin' big deals with important people.
As for the bottom for such people it will come when they realize that this was just a roller coaster ride and as such it is over. As soon as they get the idea that none of the crap is coming back, their own personal downturn will be over. From their on, it will be a struggle but you won't be alone as you have been in the past few years.
Mortgage with 20% down payment < Rent.
I live in the outskirts of Orlando plenty of empty homes round me .I will buy when the home prices our more affordable or not buy one ever again. I would not buy a short sale as I feel most our over priced .imho
Is that an erection in his pants?
"Since when is the need to borrow emergency funds to keep afloat, a good sign?"
When you're actually able to.
If the FED keeps bailing out like Japan did, 20 yrs to hit bottom.
If you listen carefully, you will hear a bell ring, letting everyone know when we have hit the bottom.
How do we know when we hit bottom?
This is extremely easy, but nobody seems to realize it:
when the implied price appreciation for houses over the upcoming year, as computed using the Case-Shiller CME futures equals the predicted inflation rate.
(implied prices of futures are a little complicated since you have to factor in the interest rates & yield curves).
I bet that this is by far the most accurate indicator on the planet.
Other than Britney getting her PHD.
When?
I haven't a clue, but at some point when the price to rent and price to income ratio is within 2 standard deviations of its historical very long term mean, probably less.
When people at any kind of social gathering aren't talking about real estate...
They might be talking about gold, they might be talking about stocks, they might be talking about international investments, but they won't be talking about real estate...
And then...if you bring up real estate and they say you've got to be some kind of moron to even be thinking about buying a house - it's time.
Keith,
You need to re-post your roller coaster graph again. If I remember this right then the bottom is capitulation right? We are not there yet, we need a deep series of panicked news that shake the average Joe to the core.
Please re-post the graph and let's ask people where we are now. Thx.
-BC
The banks are rallying. Stocks are up, lets start a conversation to see if we think financial stocks are now the buy of a century? Barrons is running an article on it thats a good read. But note actual real-estate may be a poor investment for years to come, but stocks may have bottomed? Thoughts?
I dont want us to miss the equity ride up if in fact we've formed a bottom after Bear Stearns and all the write-offs.
Thanks
People still don't have a clue as evidenced by the y.o.y. decline in number of homes sold. Everyone is still in denial holding out for the price that they "deserve". But what do you expect with all of the cable shows that are still on regularly. This year reminds me of 2000-2001 where everyone was sure that tech was gonna come back. Its over, put a fork in it. The time to buy will be about (2) years after " Flip This House" is off the air.
Don't forget that Vanilla Lice's big hit was a rip-off of Bowie's "Under Pressure"(Bowie sued him).
Under Pressure is a good theme for the current state of the economy.
Go listen to March 22nd Financial Sense Newshour, 1st hour. This whole thing is being held together with spit, bubble gum, bailing wire, and duct tape.
When stupid people scold you for considering buying real estate, that would be a good sign to buy. If the herd is convinced that real estate must fall and, therefore, don't buy anymore, it cannot fall further.
"I dont want us to miss the equity ride up if in fact we've formed a bottom after Bear Stearns and all the write-offs"
Sure jump back in, everything is A-OK with the banks. Ignore the fact that Citi is leveraged 40:1 and Fannie and Freddie are listing badly, dead in the water. With a little help from the Fed, we'll see the Dow shoot past 20,000 this year.
But like any deal with the devil, we have to offer something in return. Get used to $6 gasoline and 15% unemployment. When the Dems take over next year they will go straight to where the money is , IRAs, 401Ks, and pension funds. Then you can celebrate the record Dow by forking over a chunk of your paper profits to Uncle Sam.
We'll hit bottom when the world decides it won't transact in dollars anymore.
When the Schiller index is at 110, or when the median houseprice is three times median income.
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