Having read the summaries (sorry, don't have time to wade through all of them) of various reports, it appears that the bubbles, etc are in areas where the housing prices are greatly exceeding the wages, thus reducing the affordability of housing. The result is if there's a hit in that local economy, housing prices can fall significantly as there will be no one able to buy and many trying to sell. Simple supply and demand.
I wish my crystal ball could tell me what comes next in my market. We had a big seller market / increased prices in the late 80's, nasty bust in the mid 90's exacerbated by a large earthquake, and the last couple years a real strong sellers market, crazy increases in prices. County average was +20% in a year! Yeah I know, lies, damn lies, and statistics. B) But appraising homes sold a year or 3 ago and now refinancing are eye opening. Face slapping even. :blink:
Up, down, up... Seems like a setup for another big bust right? But with all the increases in population last few years, and the predicted (how good is that prediction?) continuing increases in population here, perhaps things will just plateau for a while and then continue up again. Housing shortage. And a pretty diverse economy, lots more than 1 industry anyway. So if 1 sector takes a hit, there's others to take up the slack. So I read. Just try not to be in an industry that takes the hit... Uh, good luck there.
A lot of the newcomers are poor, and renting low end digs. Priced out of the market. Others have seen the house they can afford shrink drastically. Then there's the first time buyers getting an "entry level" home in the $700k range in the Hollywood hills. :mrgreen:
Uncertainty prevails as usual I guess. Thinking about first time buying, so more than just a professional interest. Obviously I'm not talking high end market area, or even close. Any SoCal or other folks like to share the view of their crystal ball or snowglobe?