Key Talking Point for Bubbleheads

Here are some key Bubblehead talking points:

• 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.)