Two very simple statistical data: new home starts at 2.28 million annual rate in January, new home sales at 1.23 million rate. The supply exceeds the demand by 85%, and this supply is coming as a wave just few months from now.
<insert your own conclusion here>
I see some direct political implications of coming real estate crash. Thanks Karl Rove strategy, Bush' electoral base consists of 10% of richest voters and 40% of the most stupid people as well. His hypocrisy is too insulting for those smart people who are not rich enough. The home market crash will hit stupid people in the first place, as those are relying too much on the market bubble prices for their day-to-day spending, which can substantially erode the GOP political base.
February 28, 2006 at 9:15 am
Interesting quote from here:
http://biz.yahoo.com/special/3realestate06_article1.html
“Some homeowners may also be taking advantage of recent increases in home values and cashing out as the housing market cools. Christopher Olsen, a financial planner in Lodi, Calif., decided he needed a bigger home with a new baby on the way. But instead of trading up, Mr. Lodi sold his three-bedroom, two-bath house for $406,000 in May — $26,000 more than his broker’s estimate of the home’s value — and moved into a rental property. “We are renting for two years, waiting for the market to settle, or crash,” says Mr. Olsen.”
March 20, 2006 at 4:15 pm
Thanks Donald for referring to me at his wonderful site:
http://economicapocalypse.blogspot.com/2006/03/signs-of-economic-apocalypse-3-6-06.html