- There has been tremendous home price appreciation in the past 5 years in the bubble markets. Las Vegas Metro area 96%, Miami Metro Area 107%, Los Angelos Area 115% ( OFHEO Report September 1, 2005)
- The housing boom IS a speculative episode. The speculative boom will inevitably turn into a bust. Significant prices will occur in the bubble markets.
- About a third of home purchases in 2005 were either for investment or bought as second homes.
- There is no shortage of housing units. There were about 2.2 million housing units constructed last year ( US Census Bureau) and about 1.6 million are need to house a growing population and 300,00 are need to replace existing stocks that becomes uninhabitable. That leaves an extra 300,000 units.
- Inventory is rapidly increasing in the bubble markets. A significant number of home sellers have already lowered expectations in the bubble markets.
- Realtors who have not been blinded by this mania, now, know that the boom is over. ( The question for them is will it be a soft landing or hard landing.)
Friday, October 07, 2005
Key Talking Point for Bubbleheads
Here are some key Bubblehead talking points:
Posted by David at 3:23 PM