patrick.net

wI'm pretty bullish on the economy which I think will effect housing. Even if there's no inflation when the economy improves either rents or housing prices should go up.

Hmmm....I see more newly joined bulls. What happened to our seasoned bulls?

shrekgrinch says

Expat64 says

House prices always go up. You can’t make more land. It’s a great time to buy. Interest rates are low. Foreclosures and distressed sales don’t count. Real estate is all about location and each house is unique in its specific location so it will go up in price. The Bernank has our back. Lereah will return! And, it’s a great time to buy or you will miss out.

Please tell me you’re being sarcastic.

Seriously, I am thinking he is sarcastic.

Tim Aurora says

While I do not want say that there will not be an inflation, the following reason is why Housing market will com back in 4-5 years

* There is a need of ~1 million unit a year and currently the builder are not even constructing half of it. That will continue for a few years till the current inventory is low enough to rebound. Builders ( and associated infrastructure such as roads and schools ) will not be able to ramp up very fast and that will cause a good rebound

* Foreclosed activity started 4 years ago. The associated population can renter the market in approximately 6 years time. That gives another 2-4 years before we start see these folks coming back

* Unemployment will ease in another 3-4 years which in turn will have two effects

** Unemployed folks who are now living in their parent’s basement and apartments will enter the housing market.

** Increased confidence means folks will start moving up.

these are conditions that should see prices rising nominally with inflation (over the long term).

they will not cause prices to "come back" to rates of appreciation seen during the bubble.

I think housing will keep on going down simply because too many can't afford it, and average person out there isn't making the money hence no inflation. Housing bubble was a trend that could not go on.

It's Herbert Stein's Law "Trends that can't continue, won't.".

Housing is just consumer item, there is no reason to be bullish or bearish on it. It's like a price of potatoes, not an investment.

I expect normal 2% yearly inflation, and housing deflation since it is ballooned.... which is very reasonable considering the fundamentals. All the other stuff about inflation and more housing bubbles that's borderline conspiracy theories insecurity in people.

When there is no salary increases in sight how can the money that's going to buy homes keep coming from banks or thin air to support the still bubbly prices? Heck! there will be inflation every where but the home prices.