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re: 2 year inverted yield curve
Posted on 4/23/24 at 8:33 pm to SlidellCajun
Posted on 4/23/24 at 8:33 pm to SlidellCajun
The low lol? You're not looking at the big picture. The fact that majority of Americans can't afford housing and markets will always adjust to where a large percentage can. I'm positive a correction will happen within next 2-3 years. No shot it doesn't tank based on prior housing price to inflation/median income of US households. Would not be surprised to see even up to a 30% correction. It's at its peak now and every single time it has done this in the past, it drops significantly. It'd be hard to view that link and believe that it will not drop by a pretty large margin.
The other thing is that housing prices were at inflation increases from 1950 to 2000. Since 2000, it's way outpaced inflation. You see on the link a large correction in 2008, we are the peak today. It could even be worse than a 2008 correction. It may get back in line with 1950 through 2000 rates.
https://www.longtermtrends.net/home-price-vs-inflation/
The other thing is that housing prices were at inflation increases from 1950 to 2000. Since 2000, it's way outpaced inflation. You see on the link a large correction in 2008, we are the peak today. It could even be worse than a 2008 correction. It may get back in line with 1950 through 2000 rates.
https://www.longtermtrends.net/home-price-vs-inflation/
This post was edited on 4/23/24 at 8:45 pm
1
Posted on 4/24/24 at 11:47 am to Saunson69
quote:Your "analysis" leaves out many MANY relevant factors.
You see on the link a large correction in 2008, we are the peak today. It could even be worse than a 2008 correction. It may get back in line with 1950 through 2000 rates.
For one, the 2008 bubble pop was led by housing, not trailed by it. And that was because housing had become a game - zero equity, crazy leverage, etc. As anyone on here knows who has bought a house in the last 10 years - regardless of how good of a credit you are - it's MUCH harder to get a mortgage than back then.
IOW, homeowners have much more equity and are much better credits in the first place.
You might also take a look at price to rent ratios from now as compared to 2008. I can guarantee you they are way more in line now than they were then. And that's really what a piece of real estate is - the PV of future cashflows to be delivered.
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