Housing Statistics From Mother Jones
Mother Jones has a list of statistics on homeowners; here's a sample.
"The National Association of Home Builders’ 'showcase home' for 2005 is 5,950 sq. ft. That’s 15% bigger than last year’s model."
"1 in 5 new homes is larger than 3,000 sq. ft.—the size at which it becomes unmanageable to clean without hired help."
"Only 2.7% of San Francisco’s teachers, 5.7% of its cops, and 4.2% of its nurses can afford to buy a home there."
"1 in 4 Californians are considering moving out of state to reduce their housing costs."
"Since 2001, the number of Americans who have bought second homes has increased by 24%."
8 Comments:
When does this madness end? I have been trying to short the homebuilders with no satisfaction. We are know this is a bubble but the problem is we don't know when its going to end . Any thoughts??
P. S. This is a fantastic blog!!!!!
David,
Shorting the HB's is pretty dangerous. I have watched them everyday for months and they have a committed group of longs. The volatility is increasing, though, a sign of a turn. I am working on some interviews dealing with the timing issue, so check back and thanks for commenting.
Friends of a friend, a retired couple, built themselves a 7000 sq ft home. Now they shut off part of the house in the winter because they bills are so outrageous. American's sense of entitlement is astounding.
I dread to think what the maintenance on those large homes will be in 5-10 years. If the mortgage and energy bills don't financially drown anyone stuck with a large home, the maintenance costs will (roof, windows, paint, etc)! In the upper Midwest and Northeast winter is hard on housing. Kids are hard on house interiors.
Hi Goleta,
you're right - predicting the timing of a crash is very hard. It's hard because psychology holds up a bubble, not fundamentals. (That's why it's a bubble . . .)
I know how to relate fundamentals to prices, but I don't know enough about psychology to hazard any guesses.
Note that Robert Shiller in all of his media appearances never predicts *when* the bubble will burst. He just says that it will.
On Piggington's San Diego website, he has a quote from the Economist magazine that says something like "Two things about bubbles: 1) they always last much longer than you possibly expect them too. 2) They always eventually end."
vhb
I agree estimating the timing of the crash of the bubble is difficult but if we don't try and figure out the timing this becomes just an academic exercise on our part. I think every poster here believes that there is a bubble, my goal is to try and make money on it and not just avoid it. The property I own really isn't tradeable(my wife wouldn't let me sell our home and I need my other property for my business). We all have some anectdotal evidence of a turn but what is going to be the thing that breaks this bubble wide open? I don't need to call the top but I need to make sure I am least on the train when it leaves the station???? Any and all thoughts would be appreciated! Thank you!
My philosophy of investing:
Better to get out too soon than too late!
David,
Look for my post on Monday regarding mortgage origination/Fannie Mae that may show the train has already left the station. Good luck.
Post a Comment
<< Home