Is Now a Good Time to Buy a House?

Below is a transcript of a conversation I had with a friend about whether now’s a good time to buy a house or not. I take the position that it is; he says it’s not. So, I’ll identify my comments as BULL: ; his as BEAR:

BULL: Hey bud, long time, no hear -- how's it going? Buy a house yet...

BEAR: I'm still living in a million dollar home (expensive school district) for less than 1/2 the cost of buying. My landlord is an ATT exec living in Dubai and he's begging me to extend my lease but I'm getting very tempted to dip my toe back into that dark pool of homeownership. Even got pre-qualified. I still don't think I'll pull the trigger unless I happen across a place that monthly PITI is close to monthly rent--still very unlikely.

BULL: Dude not that I know anything about anything when it comes to real estate. But, I'm pretty darn sure prices are on the rise and will be for years to come -- at least in n. va. Or maybe I'm fooling myself. But first thing I noticed upon return was -- no foreclosure signs in my neighborhood. Indeed, very few sale or rent signs. Big difference from any time I've lived there (july 06 - on). Then I checked out zillow -- sure nuff, the estimated value of my house had rose about 5 or 6 percent from when I left. Made me feel better about things.

BEAR: I'm happy to hear that your neighborhood is showing signs of improvement, really. Most people in Va aren't so lucky. Actually, NoVa sales are up year over year but prices are still down close to double digits in the same time period. It's true that now may not be as bad a time to buy as it was this time last year but next year should be even better by that logic. We still have too many homes and not enough qualified buyers (e.g., ones with stable jobs). I'll start to look more seriously when unemployment numbers stabilize. IMO, I'll have to wait until that number is well into the double digits, unfortunately. Yeah, I still have a bright and cheery disposition when it comes to the economy :)

Virginia Home Sales Continued to Struggle in 2nd Quarter by SCOTT McCAFFREY,

BULL: It's hard to pick a bottom and anyone's guess. But personally I'm confident the bottom has already been reached and everything is up from here -- sales, prices, foreclosures (down) etc. Time will tell. Actually, the very latest national numbers reflect that -- I think it was may, maybe june numbers -- sales increased by highest amount month over month in 8 years -- prices also up significantly -- 1% in a month. Even schiller says "somethings going on."

And once foreclosures are out of the system -- wow, there will be an unprecedented pop in prices -- given the unprecedented number of foreclosures that have been sold over the past year. But, of course it won't be uniform and there will be still be great opptys over the next year. And, surely I'm at least a bit over-optimistic Or you could well be right too. But I'm surprised to see the encouraging signs this quickly -- especially given that 93% of the stimulus remains to be spent.

BEAR: Jan 10th? What time? (j/k) Curious why you're so confident about a strong housing rebound (or any housing rebound at all). My conclusions are based on supply & demand:
1 and 9 housing units vacant:

As Option-ARMs reset, people lose jobs, and immigrants flee for economic reasons, more foreclosures will occur and demand will slack. I'm open to any economic arguments why that won't happen.

Here's two articles. Watch the schiller interview if you can find it. It was there yesterday. I thought this would happen around jan 10, so we are about 6 months early.

The housing market is not the stock market. There's no point in picking a "bottom" because the bottoming process takes years rather than days or weeks. When housing does rebound, we will be lucky if it keeps up with inflation.

Something IS going on and it isn't prices coming down to Schiller's historical trend (if you know anything about Schiller, you'll recall his famous chart). I'm not sure where you're getting your numbers but the trend on everything except sales volume (not even total sales $$) is DOWN. Foreclosures are still occurring at a frightening pace... and home prices are still dropping by double digits YoY nationwide. You brought up the stimulus which has very little bearing on the housing market. Housing is fueled by the trillions pumped into the financial industry and more specifically into the mortgage securitization market. Also, the Fed is forcing interest rates down through monetary easing. Take all those measures away and it's likely that we'd be in a worse depression than the GD. Don't take my word for it, listen to Bernanke on PBS on why the Fed had to do what it did.

You're actually not any more optimistic sounding than you were. In fact, you were saying pretty much the same thing 9-10 months ago. I'll remind you what I predicted before BO was elected: just as BO got elected because the economy collapsed, his popularity will suffer as the economy deteriorates further. This short term pop is all smoke and mirrors accomplished by flooding the financial industry with liquidity. The real economy is not doing as well as the stock market or the main stream press would suggest.

BULL: Oh, and I checked the history on zillow. My house value according to zillow up about 65k since march -- over 20%. The bottom was in march.

BEAR: Sure, I'll buy all that if you show me the "math.". I've provided support for the largest glut of housing supply in history (nearly 1 year of housing inventory, high vacancy rates, another wave of foreclosures about to hit, etc.) and demand that is impaired by high unemployment and deteriorating credit-worthiness.

That's the "math" behind my conclusions. I'd love to see the math that shows otherwise and if it's actually data and not wishful thinking, I'll make an offer this weekend. I hope I'm wrong about the economy, I really do.

BULL: it's probably mostly wishful thinking on my part, but I actually do believe it. Wish I had more time for research, but I don't. I think many of the numbers you are looking at are old. I just typed into google "us housing inventory." first article was about glut in housing. Clicked on the article -- dated 2007. most current article I found was this one: you'll see it shows housing inventory down over 25% in past year. I really think things go in cycles and the markets normally overreact. They've overreacted in past 3 years to the downside and probably now will overreact to the upside.

Meanwhile population increases inexorably. Houses fall apart and are bulldozed -- inexorably. Is housing construction keeping up. Don't think so. So supply demand imbalance will come – inexorably And all current signs point to rise in housing. There's even talk of frenzy in places like phoenix. Investors, speculators are buying houses sight unseen. Similar to 2005 market. Then there is the issue of inflation... Anyway, we'll see. You may be right. This is what makes a market. The debate matters little for me. I'm all in regardless.

BEAR: You may find this piece interesting. It relates to the "shadow inventory" I referred to. If you run across anything compelling that argues the opposite, please link. I want to believe in this housing "recovery." Zombie Subdivisions and "Pig In The Python" Shadow Inventory

I probably won't be making any offers this weekend based on that. There is a substantial inventory of homes that is not showing up on the MLS, from which Ziprealty is drawing its data. I'll leave it up to you to explore that issue. I have and my conclusion that supply is being severely under-reported.
Sure there is supply destruction going on. But demand destruction is also happening, furious investor/speculator activity notwithstanding (we've already seen how that works out btw). Supply has to fall a long way to meet demand. We'll need a whole lot more bulldozers.

The macro-economic conditions are also not bright. The country is at the end of its private and public debt tolerance and balance sheets in both sectors are deteriorating. .Wishful thinking won't fix economic imbalances brought on by years of stupid monetary (federal reserve) and fiscal policies. We'll revisit these issues many times I'm sure. Good discussion. Duc.

BULL: I got nothin man. Except what I said before, prices in fact have risen over past month or so; housing starts have been way down for a long time. Lots of starts have not been completed and will never be lived in. Yet long term demand increases each day. Eventually that will show up. Worldwide housing prices are up. Inflation points up. Dollar points down. Foreign buying power increases and will affect certain areas in the US more than others –DC being a primary beneficiary. Big picture everythign points up. Especially here.

But, all the stats report trailing info of course, so, most of the stats still point down. The dollar is the biggest story I think. I can see it falling tremendously against world currencies over time. That will greatly increase nominal prices here and ability of foreigners to buy our stuff "cheap". Even a million dollars may be cheap to the them in time. I'd actually like to hear you address this specific issue of how dramatic declines in the dollar will affect nominal prices of everything – including housing.

I don't think this issue can be ignored as it could be far more important than any other issue. Especially after we borrow another couple trillion for health care, then social security, etc... One other thing -- you seem to base much of your case on this argument that gov't spending can't keep up with the destruction of asset values in the private sector. But, is it really destruction. I think not. I mean as quickly as it was "destroyed" it can all be regained and then some, simply by establishing new higher prices. All houses; all stocks; all assets are valued based on the sale of the last asset. So, if you see say a 20 or 30 percent rise in the value of these assets -- wow, we just added kajillions in new asset values. American's are rich again. Yahoo. Seems like that could happen very quickly So, what say you

BEAR: Here's how I see it: You've advanced a hypothesis that is possible but has not occurred. Year over year, valuations are still pointing down, not up. The reason why YoY is a better indicator for RE is because of its seasonal fluctuations. I agree that, if the US were in a vacuum, the dollar should be getting destroyed with the amount of "liquidity" that the Fed has provided (this is quite an indictment of current economic policies, btw). I think that the reason why it's not is because every other major economy (with the exception of Germany) has embraced similar stimulus spending and currency debasement policies. So the flooding of the major economies with fiat currency has the effect of stabilizing asset values (for now) and maintains the values of the various major currencies with one another. The USD is also in the position of being the world's reserve currency, which enhances its resilience. Without the various fiscal/monetary measures being enacted around the world, we'd be in severe deflation.

When I refer to credit destruction, I'm referring to the amount of credit/debt that is being created and that currently exists. As people default and asset values drop, credit is being destroyed. In our modern electronic economy, credit (not currency) is the real money supply. Credit has been destroyed to the tune of trillions. The Fed can try to create trillions to replace the lost "wealth" but banks are sitting on them as reserves as their willingness to lend declines with the creditworthiness of their customers. Couple that with increasing job losses, wage declines, and Americans' newfound frugality, there's no way we'll experience significant inflation. In fact, inflation on food, energy, and other necessities in this environment will probably result in riots on our streets.

So while I agree that current monetary policies could result in inflation, it would take all that electronic money (currently in bank reserves) to reach the balance sheet of Joe Sixpacks, whose balance sheets are, umm, severely "impaired" at the moment. When that happens, we'll officially be in "recovery mode" and inflation will probably knock the economy back on its ass again. The government wants inflation because that's the only way we can pay down public and private debts: by inflating them away. The problem with that theory is that runaway inflation/currency debasement will reduce China/Russia/etc.'s willingness to finance our debts.

Oh, and if/when inflation arrives, the law of supply-demand will still be in effect. You can own an asset that is losing value even as its nominal price is rising if inflation is rising faster than nominal prices. The shadow inventory data suggests that supply is being disguised and understated by the housing industry to prop up prices (and their livelihood)--a bunch of criminals if you ask me. Pres. O had no idea what he was getting into. At best, he's a classic case of the right guy at the wrong time.

BULL: You're right about many western economies, but not all, and certainly not the rest of the world (yes they are stimulating; however, China for instance, doesn't have to borrow to do that). So, in time, especially asian currencies will rise strongly against the dollar. Right? Overall, the dollar will be strongly down worldwide. I think this is a reasonable and probable prediction. Can you give me a yes or no opinion on that? It's the most important prediction to make. Your credit destruction argument is based on confidence. Confidence down, credit down. Confidence up, credit up. Confidence way down now. But, that could easily change. In fact, I think it will. Once banks start making money on lending again, there will be pressure on all of em to lend.

I think Obama had a pretty good idea what a mess we were in. He's already avoided disaster and perhaps even headed the ship in the right direction. I'm not sure he could have anticipated just how tough it would be to convince politicians and Americans to do the right and hard things that need to be done. And, unfortunately, he doesn't have the political power to do it himself. If we can manage to get rid of a few more republican senators in the next election -- well, that would make a world of difference. That's what it will take to do the hard things I fear.

BEAR: Oh, and I don't think you can reconcile your inflation theory because of runaway govt spending and debt with your last paragraph. Seems to me that the cure will wind up much worse than the disease. Gotta run...

BULL: Oh I don't know. Without "the cure" -- we'd be in the mother of all depressions, so that's not a very attractive option. Frankly, I think we are snookering the rest of the world (especially china) who stupidly keeps lending us billions at low interest rates. It actually is probably smart to take that money and do the things obama wants to do (reform health care; build out alternative energy options; improve infrastructure, education, etc) -- and mostly not have to pay it back due to roaring inflation.

Now, yes, roaring inflation will be bad too -- but better than the alternative, which again is: mother of all depressions; no health care reform; no alternative energy improvement; no infrastructure improvement; declining education; decline, decline, decline -- I guess the latter is your preferred solution?

BEAR: My preferred solution is for government to acknowledge that it can't manipulate the economy and to let it self-correct. We wouldn't have had the housing bubble if the Fed didn't keep rates artificially low for most of this decade, if we didn't have subsidies (mortgage interest deductions) for housing, if the government didn't prop up Fannie and Freddie for years. All that capital (trillions of $$$$ worth) that flowed into housing could have gone to more worthwhile endeavors (like education, infrastructure, etc.) and all that talent that went into Wall Street chasing a quick buck could have gone into cancer research, or educating children, or alternative energy, whatever...

Bad policies brought us to the brink of depression and now you want bad policies to bring us out of it? I could be a smart ass and point out what a joke it is to place total confidence in those who brought this mess on us to now deliver us from the very mess they created. No, not my "preferred solution" at all because of the likelihood of just that: "decline, decline, decline."

BULL: I certainly agree with all you say about how gov't manipulation of the economy got us into the mess. Truer words were never spoken. Where you are wrong is in whom you blame. You blame "the government" "those who brought this mess on us...."
Of course, the blame rests squarely on the backs of the American people who demand, for instance, the mortgage interest deduction. Try to get elected after calling for an end to the mortgage interest deduction. Won't happen. So, where does the blame lie?

My problem with your arguments (and all good libertarians make them) is they simply have nothing to do with reality. Yes, it's true the economy would function more efficiently without government interference. Problem is no one actually wants that because most of us would be worse off. We need gov't interference in labor laws; environmental laws; safety net stuff -- and once you start with gov't interference (which I bet even you support to some degree) -- well, then we're all in the same pot simply arguing over the details of where it stops.

Oh, of course I don't place "total confidence" in anyone. And lots will undoubtedly go wrong. That's not the point. The point is we have to make choices and do the best we can. Your choice appears to be to get the gov't out of all of this. No freddie or fannie may; no subsidies; no bailouts; nothing. That sounds nice in theory. Problem is that in reality -- again, the result clearly would be the greatest depression ever. And words don't do that justice. Had we done as you suggest, basically all lending would have been shut down last fall. That would have resulted in maybe half of our businesses going out of business. 50% unemployment means civil unrest and anarchy for years. Society as we know it wiped out; millions, maybe billions dead from hunger, disease, lawlessness.
That's actually what you are calling for. Thank God libertarian theory remains irrelevant. If it's ever implemented, God help us all.:)

Hope you never take anything I say personally -- I know you have a good heart and you're right in theory -- just not in the real world. Either that, or you have to admit you do favor some gov't involvement and, if so, then your arguments are inconsistent and it will be impossible to identify whether any of the various interferences you actually support -- contributed to or caused the very things you decry.

BEAR: Are you sure that this email wasn't intended for someone else? I point out the problems with government "manipulation" of the economy and you launch into a defense of government "interference". I might have said some very similar things to the typical unthinking "get government out of my Medicaid" crowd so... I'm confused. You're usually not prone to employing strawman arguments so what gives? I'm curious why you thought it was necessary to defend the role of government in areas that are not in dispute and that I have voiced no disagreements whatsoever over.

My problem is with government MANIPULATION of the economy for its corporate benefactors. Oh wait, they're just trying to save us from economic catastrophe, followed by the sure and quick death of billions!!! More kool-aid please :)
Ditto on not taking me personally. I enjoy it.

BULL: I'm confused with what you are confused about. I'm simply pointing out the inconsistency of your argument. On the one hand, you brand the mortgage tax deduction and inappropriate gov't "manipulation." On the other you (apparently) think it's fine for the government to, for instance, fine companies for illegally dumping toxic chemicals. What's the difference? Both actions are clearly gov't "interference" or "manipulation" to promote what most people see as good public policy.

What about unemployment compensation or social security -- both obviously "manipulate" the labor market by distorting the natural supply of labor and the price that must be paid for labor.

I could go on and on. It might be useful for you to simply list the gov't actions you support and those you oppose with a short rationale for why you think the contradictions are warranted :)

BEAR: Now you're lining up the straw men. Here's a simple bright line: manipulation = anything that distorts market mechanisms and signals. All of the other instances of govt "interference" you cite are essentially parameters/boundaries drawn for market participants to stay within (e.g., "ILLEGALLY dumping toxic chemicals"). The playing field remains level and out of bounds is out of bounds for ALL participants.

I also generally don't have a problem with safety net legislation unless they modify economic behavior by discouraging work, which some but not all of our welfare programs do. SS is a pyramid scheme--if it can be made self-sustainable, I'd be all for it.

As for your "all or nothing" argument, why stop at minimum wage and unemployment benefits? Why not "to each according to his need and from each according to his ability?" I could go on and on but maybe you can provide ME with a quick primer on where exactly the line is drawn in your vision of democratic-socialism.

BULL: Maybe this is what you've been looking for --

BEAR: I need those 2 minutes back. This guy writes a column referring to C-S index, the NAR website, the BLS (nevermind that NAR and BLS are the two organizations most prone to statistical manipulation) and doesn't explain how a single shred of "data" there supports his opinion. Next he refers to some anonymous guy (C.S., Charlie Strawman?) who wrote a comment somewhere on housing but doesn't advance a single argument on why "C.S." is wrong and he's right.

This guy can't even mix his kool-aid right and I'm supposed to drink that up? Not what I'm looking for. But hey, did you check out Realtytrack's July YEAR-OVER-YEAR foreclosure data? Check it out. That and retail spending for July ($1B leveraged Fed injection in Cash for Clunkers notwithstanding).

BULL: I think he was just pointing people to raw data so they can make their own conclusions. We'll just have to agree to disagree. No problem. Time will tell.
Bet you a beer that one year from today home prices will be up in your precious year over year category. Up in every category, double digits in single family home resales -- nationwide. Given the glut of foreclosures that would seem to be a pretty good bet for you. But, it's not.

BEAR: Hah! You want me to bet against Uncle Sam? Ok, why not. I'll take that bet straight up and I'll even give 6 to 1 (you'll probably need a whole 6-pack by then) if the Fed doesn't spend another red cent buying up mortgage backed securities to prop up housing (I'll even let the interest rate manipulation slide).
Your betting that RE will rise via the dollar getting destroyed and on the back of government manipulation of the housing market is bizarre but definitely the MUCH smarter bet given that this administration has signaled that it is pulling out all the stops to prop up the markets. Let's not fool ourselves, my "precious" year over year categories would be even MORE dismal now had it not been for the over $10 TRILLION pumped into the economy and the markets over the last 18 months.

Ironically, things probably WOULD be better by next year if we had let all the bad debts default rather than keeping them on the backs of people who overstretched on credit during the boom years. The biggest "bail-out" for people would have been changing bankruptcy laws to provide people a fresh start within 2-3 years rather than 7-10 years. Instead, we bailed out the banks and kept the people saddled with underwater mortgages and years of payments on consumer loans spent on consumer products, of which there is now a huge glut.

People who need a fresh start by having their debts wiped clean are instead hoping for inflation (as if their wages will somehow keep up) so they can make minimum credit card payments and pay their underwater option ARM mortgages on their not-so-"precious" homes. Makes no sense to me.

BULL: I think I agree with most of what you say. Maybe all. Because now I'm thinking maybe you agree with me on the fundamental question we have been discussing which is:
Will nominal prices (meaning the dollar amount that houses sell for) – be UP or DOWN -- one year from today. Nevermind the rants about the way our world works -- that's the reality we must live in, deal with, and make the best choices we can. So, the question is -- up or down -- which is it?

BEAR: REAL prices down. That's the only way to compare this year's apples to next year's apples.
Nominal? Who the heck knows but extrapolating current values in the dollar and inflation, most likely down as well. But if Tbills stop selling and we'll have to print (even more of) the money we're spending or the dollar breaks, all bets are off.

BULL: What a cop out! So despite all the stats and knowledge you have – you can't answer the question everyone wants to know --
Will the price of the own I own or the one I might buy be higher or lower next year? That's the key question. If higher; one should buy; If lower; one should sell -- everything else being equal like personal family situations, etc.

And, I thought that's what our bet was. Not some fuzzy notion of what "real" prices are. Jeez, we'll argue over that one forever. I know all sorts of crazy things might happen that could throw anyone's prediction off. Of course. But, we still have to make the best prediction we can.
Anyway, I see you do indicate nominal prices "most likely down" -- so, is that the bet "nominal" prices -- up or down. I say up; you say down? And, interested what the odds are you give that t-bills will stop selling and we will have to print more money -- and what that means for NOMINAL house prices.
Let's say your position is 51% chance nominal prices down; 49% chance they up. But say 15% chance of tbills not selling; printing vast quantities of dollars; dollar plumets; inflation (in dollar terms) skyrockets -- so, now what happens to house prices? And, how dangerous is it for a renter to take that risk?

BEAR: Dude, we can't have a conversation on economics if you don't even understand basic terms: Read up and get back to me. Real values are easily calculated and are the only accurate way to compare data

BULL: I understand, you aren't comfortable with the bet (cause you know deep down that I'm right) and want a way out. Just admit it; I'll let you out. No problem.

As the article you link aptly illustrates; nominal prices are much easier to ascertain than "real values" which include "adjustments" for inflation. And, there are an infinite number of ways to account for inflation. I guess you can name the index (basket of goods) you want to use and we can do that. But, again, as your article states "In economics, nominal value refers to any price or value expressed in money of the day" And that's what I and you should be concerned with when it comes to housing? Why?

Housing is different. We all have to have it. It's not like you can choose to avoid spending money on housing. So while some other asset class might outperform housing relative to inflation -- that probably doesn't matter if the nominal price of housing goes up since that's what you will have to pay. And the difference in the current nominal price and future nominal price is what you will either gain or lose. No choice in the matter. I guess you could say, well, it will cost me such and such more over the next year to buy rather than rent. Let's pick 10k as the number for sake of argument. And you say you are going to invest that 10k in something else that will outperform housing. So, you continue to rent.

Let's be very generous and assume this other asset outperforms housing by even double. Maybe 5 percent vs 10 percent. So, you have made 1k income; but lost $500 in increased housing rental cost; so net gain of $500. But that doesn't account for the power of leverage when you own. You actually lost big time because your 500k house now costs 550k so gain would have been 50k blowing any conceivable other investment out of the water. This is why, for housing, what matters is nominal prices. If nominal prices go up an "investment" in housing will blow any other investment away; conversely, of course, a decrease in the nominal price blows away any other investment "loss"

So, for one last time, it all comes down to NOMINAL price. Up or down. If up, you should buy. If down sell. And, of course, none of that is realized till you sell, so really issue is more long term than one year -- and long term, the future increase in housing prices seems even more certain. This is too easy. I need to start a new website to share my housing investment genious with the world -- obviously it's falling on tin ears with you :)

BEAR: Hmmm, I'll admit that that's an interesting analysis but there are some serious holes in it. Your hypothesis is that capital assets that may be depreciating in real terms should nevertheless be acquired in inflationary environment? So what keeps an asset of which there is an excess of supply from continuing to depreciate even in a high-inflation environment? In the real world, real people's spending is limited by their monthly wages. During inflationary periods, if more of people's wages are shifted toward paying for the necessary commodities of which there is a constant and inelastic demand (food, diapers, fuel, booze etc.), demand for other, more discretionary items will plummet.

I know that you will argue that housing demand is inelastic. While that is certainly more true with basic housing (and your parents' basement), nothing is further from the truth w/r/t the kind of homes that we have currently have a glut of on the market. The biggest and most unfortunate result of the housing bubble is a massive supply of outsized suburban McMansions (the only kind that I'd buy to live in at the moment) that are much too big and generate much too high utility bills for your average 3-4 person family with uncertain employment status.

While smaller housing units accessible to public transportation (remember we're hypothesizing skyrocketing fuel prices) in urban centers with jobs may go up according to your hypothesis, all other housing classes beyond the most basic living standards will be threatened. I have no interest in living in a 1200 sq ft box near Metro at this point in life. When the cost of paying for necessities claim a greater and greater percentage of your paycheck, people's credit worthiness for large capital assets (McMansions) will plummit. Moreover, higher inflation will result in higher interest (see the 12-18% mortgage rates in the 80s), reducing affordability (my first mortgage in 1994 had an 8.5% rate). This results in LOWER house prices, not higher.

Rising costs of living WILL force people downsize, adding to the glut of supply for non-basic housing. So, if you want the real deals for capital assets like McMansions, wait until the dollar gets cheaper and for demand to crater as spending is forced to shift to purchasing life's daily necessities.
Thinking this through has been a useful exercise, though. You raise some interesting points. I've thought about being a slumlord on basic housing near metro stops for a long time. I wouldn't want to live in them but I'd accumulate them for investment purposes. Wanna go into business?

BULL: You make good points, particularly about McMansions. I just think inflation will wipe out everything else. We'll see. If I had the money I'd be happy to go into business with you. Tell you what, you put up the money and I'll be the brains of the operation :) Sounds like you have now limited your anti-housing rhetoric to McMansions ?? Luckily I don't own one of those.

BEAR: If I were to do that, I wouldn't have much money left either. Then, between the two of us, we'll be twice as broke and half as smart. Decline decline...

BULL: So before we "lock this thread" Just to confirm -- you have no opinion on whether nominal housing prices will go up or down in the future Right?

BEAR: REAL prices down (coz that's what matters). Nominal down unless they break the USD. Lock it up. Next topic?

Straight Up Real Estate says that there is no better time than now to buy or invest in real estate. It's a great site, written by a man with experience in real estate investing, so check it out.

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