"The Standard & Poor's/Case-Shiller 20-city index released Tuesday ticked up in July from June. But the gain is merely temporary, analysts say. They see home values taking a dive in many major markets well into next year."
Where are the housing bulls? Nowhere. They're NOWHERE for the next few years as I've prognosticated in previous entries on my little blog. I'm a contrarian's contrarian in that I always bet against the crowd during extremes. When shoeshine boys, Barbara Streisand, and UPS drivers were trading internet stocks in 1999, I knew the jig would be up soon. When it looked like the end of the world on September 11, 2001, I felt just as scared as everyone else and admittedly, I didn't buy anything when the market opened up again. I did start buying too early in 2002 and racked up losses before the market took hold and started to climb again. So what's the J-Sonoma meter telling me now?
An extreme melting point in the real estate market hasn't been reached yet. Prices have pretty much stabilized and although buyers are scarce, deals are still being done. I think there's still steady price erosion ahead that'll probably ratchet prices back to the levels that were being bid in 1999-2000. If that happens, I think buyers will become courageous and start bidding again.
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