Jump to content
House Price Crash Forum
Sign in to follow this  
canny man

Us Crash 'could Be Severe'

Recommended Posts

Good article on why the US is facing bigger falls than before. Includes this factual nugget.

Under normal circumstances, the fact that housing prices are continuing to rise would be something to cheer. But the housing boom has been going for most of this decade. And housing markets can't be overvalued for too long, as imbalances in residential real estate prices will eventually lead workers to relocate to more affordable cities.

The bottom line: Real estate prices eventually correct themselves. And unfortunately for homeowners, it often takes years before home prices start to rise again, especially after a big run up.

National City recently studied 66 major metro regions over the past 21 years that suffered through a 10 percent or greater decline in prices for at least a two-year period of time. It found that home prices, once they begin to correct, tend to decline 17 percent on average before markets heal themselves.

"And the average duration of these adjustments is 3.5 years," says DeKaser.

So what about families who recently bought into one of these "extremely overvalued" markets in hopes of turning a fast buck? "I extend them my deepest sympathies," says DeKaser.

http://www.usnews.com/usnews/biztech/artic...sing_bubble.htm

Share this post


Link to post
Share on other sites

ouch... but don't worry...

if the BBC were aware of the same dangers here we could rely on them to make us aware,.... :)

I trust them :)

Share this post


Link to post
Share on other sites

When the US sneezes Europe catches a cold. When the US catches a cold Europe catches the Flu. When the US catches the Flu Europe............................... :o

IMO we are headed into the early stages of a recession. The HPC is about 6 months old in the US and the momentum to the downside is only just beginning as early sellers are now being forced to cut prices having waited 6 months for offers that have not materialised. In the UK RICS points out that the sellers are growing:

http://uk.biz.yahoo.com/15062006/140/house...umped-rics.html

Homeowners also appeared keen to sell their property, with 18% of surveyors saying there had been a rise in the number of homes coming on to the market, the biggest increase for a year
.

With a flood of properties coming to market the supply side outweighs the demand (which is crushed by affordability issues in any event). Since HPI and MEW are 70% of the UK economy the consequences of the HPC will be a sharp recession. 1989 Heavy.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.