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Originally Posted by Cute Fuzzy Bunny
Homes here more than doubled in price in 4 years.* A fair bit of the bloom is off that rose right now...
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Yup, here's Sacramento:
It looks like the historic mean for that area should be around $150K in 2005 dollars.* * Around a 50% fall from today's levels.* *So, yeah, you'll get to feel a little schadenfreude for a while when your neighbors first turn upside down.* *But then the decline will probably last 10-20 years as we mean revert.* *People will feel poor.* *They'll stop spending.* *We'll have a deep recession.* *Then people will start walking away from their upside-down mortgages.* *Banks will take a hit.* * Fannie Mae will require a bailout.* *And this will all happen at a time when the US already has record debts.
I don't like the looks of this thing. It's a monster.
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