PREVIEW-US home prices to eke out small June gain
Looking at the article, one poignant quote follows below:
"U.S. home prices likely eked out a small gain in June, but a rise would represent the final tail-winds of the homebuyer tax credit that ended in April rather than housing market improvement, economists said."
Economists have a knack for stating the obvious and getting outfits like Reuters to trumpet the obvious across newspapers online and offline. Housing on a national scale won't recover for at least another 10-15 years. At that point, the recovery won't even be appreciable. I'm talking sustained back-to-back 1-2% price increases instead of the drops and flatlines we've been seeing for the past few quarters. Markets have a way of destroying value just when everyone's all in. In the recent real estate bubble, plumbers and truck drivers became real estate moguls. That's reminiscent of the dot-com bubble when UPS drivers and Barbara Streisand day-traded their accounts and earned a few thousand dollars every day on E-Trade, Datek (now part of Ameritrade), and Schwab.
Of course, it all ended in tears because not everyone can be a millionaire. Who'll serve coffee at Starbucks if everyone's got a few million tucked in the savings account? Who's going to get me a burger and a side of fries?
Home prices won't recover appreciably anytime soon but the recovery is coming. That's how markets work - they destroy excess and reset to zero before growing again. We're still in the destruction phase but the reset will happen in the next few years. That's why I started this blog so I can map the recovery and offer anecdotal evidence and share any of my potential investments in real estate as the economy in the United States picks up again.
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