HELP   |   REGISTER   |   LOGIN
RSS
The Individual Investor Intelligence Network
HOME  |  GLOBAL MACRO  |  MEDIA  |  TECHNOLOGY  |  BIOTECH  |  COMMODITIES  |  EDUCATION  |  IU25 INDEX  |  ABOUT US
Comments
View Comments: Newest First | Oldest First | Threaded View
<<   <   Page 4 / 4
Scott Raynovich
User Rank
Blogger
Re: the only thing we have to fear is fear itself?
Scott Raynovich   4/5/2011 8:18:53 PM
NO RATINGS
Good point Scott, I've actually been working up some more analysis of the Real Estate market which I will sum up on the site next week but here are all of the factors:

1) Foreclosure inventory -- as long as the "hidden inventory" of foreclosures hangs over the market, it's going to be hard to make progress. Last reports I saw this was hanging out around 9-10 months. When it gets down to 6 months we know we've made progress.

2) Reversion to the mean. Real Estate traditionally earns about 1% above the inflation rate over the long term. We earned about 10%+ gains for ten years and now we're mean reverting. Another few years of treading water and inflation building, and inflation will start to push R.E. values back toward the long-term mean trend line after what's likely to be an over-correction.

3) Bank lending: Banks are still stingy with loans. When they loosen up, it will help. They're just starting to get there.

4) Employment. My leading factor in R.E. Unemployment is still too high. I see the R.E. market improving if employment can get back down below 7%.

5) Affordability. Rents are going up. Mortgage rates are still attractive. Housing prices are still going down. This is the recipe for the cure. This is probably the best boost to R.E. If employment can pick up, lots of renters can think about becoming buyers.

Scott
User Rank
Gold
the only thing we have to fear is fear itself?
Scott   4/5/2011 5:28:32 PM
NO RATINGS
The housing market's problems are not just a matter of perception on the part of the consumer, that is, the home buyer. Most home buyers are also home sellers and most people who are underwater on a mortgage can't sell even if they can find a buyer because the price won't pay off the mortgage.

Consequently, the housing market is in a state of gridlock, a log jam, and the Fed dumping more cash -- they have, what, $600B more they still plan to print up? -- into the economy is driving up inflation in every sector it seems EXCEPT the housing market, where help is most needed. It also doesn't help that getting a home loan, in spite of the low interest rates, is a lot harder now than it used to be.

<<   <   Page 4 / 4




The blogs and comments posted on Investor Uprising do not reflect the views of Investor Uprising, PRNewswire, or its sponsors. Investor Uprising, PRNewswire, and its sponsors do not assume responsibility for any comments, claims, or opinions made by authors and bloggers. They are no substitute for your own research and should not be relied upon for trading or any other purpose.
Latest Blogs
Telecom-equipment maker Ciena is a stock trader’s dream, as long as the timing is correct.
The FTC is offering a $50,000 cash prize to the person or group that can come up with a solution to those annoying robocalls.
Akamai is in the middle of four significant tech trends.
John Malone of Liberty Media will be taking over Sirius XM satellite radio when the existing CEO Mel Karmazin steps down. What's it mean?
Demand for students of the humanities exists, despite widespread aspersions on the discipline.
IU Education
Resources to help you become a better investor
IU Education
Quick Poll
Investor Uprising on Twitter
Investor Uprising on Twiter
Market Chatter
Like Us on Facebook
Top 10 IU Hot Topics
25 market-moving companies we're tracking
PR Newswire's Terms of Use Apply | Privacy | Contact Us
Copyright © 1996-2013 PR Newswire Association LLC. All Rights Reserved.
A UBM plc company.
PR Newswire