patrick.net

The ups and downs of the chart doesn’t matter that much, only the final resting place/bottom line.

NO! The chart matters because the investor will freak out in the middle and get out at the wrong time.

One must also optimize for his/her psychological well-being.

The funny thing is, not a single house we've looked at and considered putting in a "fair priced" offer on in Southern Marin hasn't already been reduced 10%+. Many homes are approaching 20% markdown from the initial listing price. Even more for those few I've watched go on & off over the past 2 years. Some of those are over 30% down.

I say the correction is well underway, it's just not going to show up in statistics for a while because of the product mix and sales volume changes.

I also say that most people will only recognize the correction *after* it's occurred. For reference, many people didn't embrace the early 90s drop in prices until the late 90s, well after prices had already started back up.

I also say that most people will only recognize the correction *after* it’s occurred.

Yes. Most people recognize only "facts" they like. It takes a lengthy denial cycle for them to see the truth.

Randy, yes, that's my point exactly. If you look hard enough, you definitely see bargains at the micro-level. At the macro-level, it's murkier. But I'm now very confident that the slide is happening. (Check out this post on craigslist: http://sfbay.craigslist.org/sfc/rfs/338727108.html)

It's been fascinating to watch things fall apart first in Phoenix and Sacramento (maybe 1.5 years ago), then in Napa/Sonoma (about a year ago), then in East Bay (starting last year) and then in pockets of Marin/SF/Peninsula (now).

The craigslist post is pretty telling. We all saw developers giving away swimming pools and granite counters in Sacramento in 2005-2006. Yesterday there was an article about a house selling at auction for 50% off it's original selling price.

When you see SOMA developers giving away cars, you know that it can't be that long before the train hits. Plenty of people are still standing around on the tracks though... I do think it'll take a few more years before it's common knowledge. Still cheap (dumb) money floating around. Stocks still climbing. LBOs still happening. China still lending. Etc.

Randy, yes, that's my point exactly. If you look hard enough, you definitely see bargains at the micro-level. At the macro-level, it's murkier. But I'm now very confident that the slide is happening. (Check out this post on craigslist: http://sfbay.craigslist.org/sfc/rfs/338727108.html)

It's been fascinating to watch things fall apart first in Phoenix and Sacramento (maybe 1.5 years ago), then in Napa/Sonoma (about a year ago), then in East Bay (starting last year) and then in pockets of Marin/SF/Peninsula (now).

The craigslist post is pretty telling. We all saw developers giving away swimming pools and granite counters in Sacramento in 2005-2006. Yesterday there was an article about a house selling at auction for 50% off it's original selling price.

When you see SOMA developers giving away cars, you know that it can't be that long before the train hits. Plenty of people are still standing around on the tracks though...

I do think it'll take a few more years before it's common knowledge. Still cheap (dumb) money floating around. Stocks still climbing. LBOs still happening. China still lending....

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