"9.Because boomers are retiring. There are 70 million Americans born between
1945-1960. One-third have zero retirement savings. The oldest are 66. The
only money they have is equity in a house, so they must sell."
"6.Because the housing bubble was not driven by supply and demand. There
is huge supply because of overbuilding, and there is less demand now that the
baby boomers are retiring and selling."
This is also so 2005 when 2M homes were built for 5 straight years, most in suburbs and exburbs. For the past 8 years, homes are underbuilt, less than 1M, which drives the supply problem now. Boomers are not selling for another 20 years which means the generation x will pay for it.
"3.Because it's a terrible time to buy when interest rates are low, like now."
While that may true, interest rate have trended down in one direction for 30 years. Good luck waiting for interest to be back to 1980, which is never. Low interest makes carrying assets cheaper. Most homes are now off the market forever because of low interest rates. record low inventory amid record prices proves this
"2.Because it's usually still much cheaper to rent than to own the same size
and quality house, "
flawed logic. whether it is cheaper to own or rent is based on future unknown factors (future rent and future price). The lifetime owner in Palo Alto is at least 10 time richer than the liftetime renter in Palo Alto.
"1.Because house prices are in expensive areas still dangerously high compared
to incomes and rents."
Flawed logic. Homes are expensive because people pay for them and will pay even more for them. It's proven prime homes gets people rich. Buying cheap homes keeps you broke. location, location, location is not going to change, ah maybe location x5.
The returns gragh is reason why software guys should stay away from commenting about housing.
You get that result if the home is vacant. In the real world, duh, homes collect rent or avoid rent. Once that duh,momment comes in, real estate is the best investment vehicle.
You know that because it pass the eyes test as the rich ass owns all the land. Real estate is the most common path to wealth in this world.
You know that real estate kick ass because the vanguard real estate index beats the legendary 500 index if you bought both from day 1 of existence. Look it up yourself. Vanguard real estate index vgsix, which has a 20 year history would made you a richer than the 500.
Right now, It's damned if you buy and more damned if you rent. That's what make Patrick.net so devastating and ruin a lot of people the last 4 years and why I commented as much as I did and debunked Patrick's "xx" book and gave Thomaswong a hard time since Dec 2009.
software engineering. Pretty much every company in this world would love some code to solve some of their many business problems. The possibilities of coding and the problem it can solve are limited only by capability.
For example, Uber's taxi calling platform for the customer and driver is a brilliant piece of software yet there is so much more potential to make it better.
There's just no seller right now, regardless of the stupendous price. There are too many reasons to hold on to homes forever. My best guess is price comes down ahead of the next recession, around 2H of 2017. That would make it 5 up years which is always followed by 3 lean ones.