Someday we'll look back and know exactly when the Housing Bubble popped.
The steep climb of prices and steep decline will seem to have happened fast, as least compared to all that happened before and all that happened after. Depending on where you start the curve, it will probably unwind at about the same severity as it increased.
But while it's happening, it's a bit like watching a bucket fill with water, one drip at a time. Rather hard to comment about.
Somehow it was easier to talk about the crazy out-of-control building, to speculate about the possible peak, especially when it seemed like most people were in denial, than it is to have a running commentary about the decline. It seems almost cruel, almost too much "I told you so...."
I thought there was a particularly good exchange of comments over on the Bendbubble2 site, that summed up things rather nicely, if I do say so myself. Since I know that some of you feel the comments over there can be too extreme, I thought I'd reproduce them in part here.
Bend Economy Man said....
These builders are all just scared to know where the REAL market price is. There's over 2000 houses and almost 1000 empty lots for sale in Bend, and houses are selling at the rate of 100 per month. At David Foster's reported current median of about $350K, there's $750,000,000 worth of houses for sale in Bend right now. At Bend's average household size of 2.42 persons, we'd need about 5,000 new people, like a 7% population increase, to eat up that inventory (and that doesn't even include FSBO and builder-direct-marketed homes).
No sky-is-falling bullshit here -- that just sounds extremely unlikely and anyone not wearing blinders has got to know that $750M and 5K people are not just going to show up in Bend in time to save the day.
So I'll just leave it to those who are browsing this forum to draw their own conclusions on what WILL happen.
Duncan McGeary said....
Not to mention that even if we had 5000 people wanting to move here, they have to be able to sell their houses, and qualify for a loan. Then they have to be stupid enough not to wait for the price to drop.
Meanwhile, houses might start emptying out from hurting builders, sub-contractors and finance people.
And the Dark Matter that IHTBYB talks about. And the houses coming online.
It doesn't take much imagination to see a stock market fall, a terrorist attack, bad weather, any number of things aggravating the problem.
Bend Economy Man said....
Agreed, but I don't even think you need any "what-ifs" on the negative side. The series of miracles that would happen on the positive side pretty much make Bend RE a "Hail Mary Pass" play right now, at best.
Duncan McGeary said...
Too many houses.
All the rest is commentary.
6 days ago