Sunday, 9 January 2011

US house prices - where next?

According to the Case-Shiller index, US house prices stabilised in 2010. Nevertheless, the post-bubble correction was huge. Prices are down 30 percent from the peak of summer 2006. Prices are now at the same level as they were in November 2003.

However, that last datapoint looks worrying. It is pointing south. Could the market be double-dipping?


Anonymous said...

A double dip for sure.

Sackerson said...

Id suggest taking recessions as reference points for where we "ought" to be, when inflation isn't distorting our perceptions. Say, 1982, or 1992-ish. Or as far as the stockmarket is concerned, even early/mid-2003. At these times, I felt the situation was tough, but we were finally facing reality.

These were points when the economy was becalmed because of previous pilot errors, and they offered the opportunity to reset the course; but the captain ordered the engine room to go full steam ahead, reckoning to smash the rocks when we hit them.