Bob Shiller: 'Decline May Well Continue for Some Time'
Yale econ professor Robert Shiller had an op-ed in the Times this weekend that talked about why there’s not necessarily an end in sight for the decline in the country’s housing market. The piece examines why other declines have dragged out for years: “Despite the uptick last week in pending home sales and recent improvement…
Yale econ professor Robert Shiller had an op-ed in the Times this weekend that talked about why there’s not necessarily an end in sight for the decline in the country’s housing market. The piece examines why other declines have dragged out for years: “Despite the uptick last week in pending home sales and recent improvement in consumer confidence, we still appear to be in a continuing price decline…Several factors can explain the snail-like behavior of the real estate market. An important one is that sales of existing homes are mainly by people who are planning to buy other homes. So even if sellers think that home prices are in decline, most have no reason to hurry because they are not really leaving the market. Furthermore, few homeowners consider exiting the housing market for purely speculative reasons. First, many owners don’t have a speculator’s sense of urgency. And they don’t like shifting from being owners to renters, a process entailing lifestyle changes that can take years to effect.” He concludes: “Even if there is a quick end to the recession, the housing market’s poor performance may linger. After the last home price boom, which ended about the time of the 1990-91 recession, home prices did not start moving upward, even incrementally, until 1997.”
Why Home Prices May Keep Falling [NY Times]
NYC isn’t really that ‘speculative’ of a market. people don’t buy things here as second homes”
Not anymore. But they did. An apartment in your brownstone is essentially a second or third home.
“selling your home and renting because you think the market is going down is not something a lot of people really care to do.”
By definition, smart money is not a lot of people.
“Anybody who bought in the early 200s or anytime before still has a nice profit, even at prices that have come off the peak.”
If you ignore refi’s and over-the-top renovations.
***Bid half off peak comps***
I’m a homeowner looking to sell to rent to wait out mkt but freaking problem is rent is still pretty expensive. If these rents I’m seeing has dropped alot then rent might’ve been ridiculous before the correction
BHO leave these delusional Assholes alone! With the “Data” staring them in the face the Dumbasses are still incredulous!!!!!!
Cognitive dissonance
http://en.wikipedia.org/wiki/Cognitive_dissonance
Cognitive dissonance is an uncomfortable feeling caused by holding two contradictory ideas simultaneously. The “ideas” or “cognitions” in question may include attitudes and beliefs, and also the awareness of one’s behavior.
See what I mean??!!! Leave them alone!
The theory of cognitive dissonance proposes that people have a motivational drive to reduce dissonance by changing their attitudes, beliefs, and behaviors, or by justifying or rationalizing their attitudes, beliefs, and behaviors.
At this fucking point the Mutant Asset Bubble is DEAD but the Assheads find something to “Hold on” to! Any piece of bullshit or the denial of a appraisal report is self-reinforcing nonsence.
You have T-Minus 5 months retards….
The What
Someday this war is gonna end….
The only mistake I can cite on the part of Bobby Shilly is that a few months ago he illogically “told the people what they wanted to hear” by suggesting a price drop slow-down and possible rebound without addressing the data lag, teaser rate resets and tightening lending standards. Now he’s quietly changing his position back to gloom and doom. I haven’t completely confirmed my suspicion but this is my sense.
***Bid half off peak comps***
joe, why would you be exempt from cap gains tax????
BHO….NYC isn’t really that “speculative” of a market. people don’t buy things here as second homes (except maybe very wealthy Europeans). Most purchases in NYC are primary residences and selling your home and renting because you think the market is going down is not something a lot of people really care to do.
Anybody who bought in the early 200s or anytime before still has a nice profit, even at prices that have come off the peak.
“Schiller is smart guy and usually is pretty astute about the real estate market. But you also need to realize that his numbers for New York have almost nothing to do with New York City, let alone Brooklyn.”
So the tripling of his NY index (+200%) and the tripling of NYC proper (yup, multi-fam brownstones/coops/condos all up +200%) from trough to peak was all one big random coincidence? Can you please explain the isolation of the NYC proper market from the rest of Tri-State? Don’t Manhattan employees have the option to purchase housing in the five boroughs or Jersey or Upstate or Long Island. Don’t their decisions affect the pool of qualified buyers in either market?
***Bid half off peak comps***
Guys it’s so over..
The What
Someday this war is gonna end..
BHO I totally agree — if I were sitting on a brownstone for 10+ years after watching the price triple, I would be out the door faster than you can say “urban blight”. Plus, I’d be able to sell it without paying cap gains tax, send my kids to Groton, and buy an entire county in Florida. Maybe I would have missed the peak by 15%, but shoot — still basically won the lottery on it.