Bloomberg article: U.S. Housing Slump Has 'Just Begun,' Says Forecaster Talbott

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Expaticus_IHB

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Mentions Santa Barbara.



http://www.bloomberg.com/apps/news?pid=20601206&refer=realestate&sid=a8mdg7z0u7Dw



<blockquote>Bankers may ?try to blame the crisis on poor Americans with bad credit histories, but that is not the real cause of the housing crisis,? he says. ?The greatest home-price appreciations and the homes most subject to price readjustment are in America?s wealthiest cities and its glitziest neighborhoods.? </blockquote>
 
<em>Five More Years



Talbott?s latest predictions are sobering. The U.S. is only halfway through the total potential decline in housing prices, he says. Home values will continue to deteriorate for four to five years, he forecasts. Adjustable-rate mortgages issued in 2004 and 2005, for example, are only now resetting for the first time, he notes. </em>



<em>At the end of 2008, a record 19 million U.S. homes stood empty and homeownership sank to an eight-year low as banks seized homes faster than they could sell them, the U.S. Census Bureau said this week. Almost one in six owners with mortgages owed more than their homes were worth, Zillow.com said the same day. </em>



<em>So how far will the price of your home on the range fall? Citing historical data and trends, <strong>Talbott concludes that real prices should return to their average 1997 levels, adjusted for inflation.</strong> Why 1997? A 120-year historical graph shows that real home prices in the U.S. stayed relatively flat for 100 years, then began rising in 1981 and surged from 1997 to 2006. </em>



Patience....patience....patience....
 
Graph already posted this a couple of days ago in the "headlines" sticky.



<a href="http://www.irvinehousingblog.com/index.php/forums/viewthread/128/P3425/">http://www.irvinehousingblog.com/index.php/forums/viewthread/128/P3425/</a>
 
The other problem nobody cares to mention...the Demographic issue. The baby boomers will not be around to pull the US Economy out of the rut this time around.
 
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