We hve not bottomed in the residentual unit or comercial unit sectors and will not for quite some time (10 TO 30 YEARS).  THE IMPLICATIONS OF THIS ON LONG TERM ECONOMIC RECOVERY ARE HIDEOUS AT BEST.  Niblock's company sees MOSTLY the home repair and improvement stuff which is of course doing better BECAUSE PEOPLE ARE NOT MOVING, THEY ARE IMPROVING AND STAYING PUT OR FIXING UP SO THEY CAN SELL.

If you are interested in the numbers, please email me and I will give you the facts that say, these markets will likely never recover to any reasonable level.  For example the COLORADO LIVING UNIT SURPLUS WILL LAST 10 TO 30 YEARS DEPENDING ON BEST CASE OR WORST CASE ASSUMPTIONS.  SAME FOR COMERCIAL AND RETAIL SPACE. THE NUMBERS ARE EASY TO CALCULATE FOR EACH STATE!

MY EMAIL ADDRESS IS RICH.GOTTBREHT@GLOBALINSIGHTS.BIZ.  IF YOU WANT TO TALK PLEASE CALL ME ON 303-905-0415.

We hve not bottomed in the residentual unit or comercial unit sectors and will not for quite some time (10 TO 30 YEARS).  THE IMPLICATIONS OF THIS ON LONG TERM ECONOMIC RECOVERY ARE HIDEOUS AT BEST.  Niblock's company sees MOSTLY the home repair and improvement stuff which is of course doing better BECAUSE PEOPLE ARE NOT MOVING, THEY ARE IMPROVING AND STAYING PUT OR FIXING UP SO THEY CAN SELL.

If you are interested in the numbers, please email me and I will give you the facts that say, these markets will likely never recover to any reasonable level.  For example the COLORADO LIVING UNIT SURPLUS WILL LAST 10 TO 30 YEARS DEPENDING ON BEST CASE OR WORST CASE ASSUMPTIONS.  SAME FOR COMERCIAL AND RETAIL SPACE. THE NUMBERS ARE EASY TO CALCULATE FOR EACH STATE!

MY EMAIL ADDRESS IS RICH.GOTTBREHT@GLOBALINSIGHTS.BIZ.  IF YOU WANT TO TALK PLEASE CALL ME ON 303-905-0415.

Very nice site!

Kinda think, Rich has got it right...no time to go to his site, might be interesting though? Seems firm enough in his convictions.

I would point out that we probably are witnessing a FALSE/POSITIVE. With tax time just now passing us by, along with stimulus checks; There is a very good chance of what R.G. eludes to of fixing-up,staying put and tax credits AGAIN AVAILABLE for energy improvements.

Living in a cold climate, that was a good incentive for us a couple years ago, and probably will take some more advantage this year at a reduced level.

With the possibility of all the foreclosures, we also have investors stepping in to buy cheap,fix and new coat of paint for rentals or turn arounds,flipping.

Depending on location the 10-30 years out for recovery?I believe i would err to the lower side. But the description as HIDEOUS, does pretty much explain what I've notice in short traveling areas or regions.

Unnerving is when they plow down homes NEW and OLD and haul them to landfills, to me in most cases,is somewhat stupid and not the best business decision for all involved.

And the bottom line is the fact of the smaller retail and then some major commercial properties, that are going in to failure, those are becoming quite noticeable also. So, folks we are not even close yet!

Funny that a report came out today about home sales at their lowest rate in history. Home construction dropped in April too. Oops. Looks like Lowes was blowing smoke.

It really is simple.  People are buying foreclosures.  Foreclosures usually need fixing up.  People go to Lowes to buy stuff to fix up their house.  I don't think Lowes has much to do with housing bottom.

Major contractors do not buy at Lowes. People who are trying to save money by doing the work themselves will buy Lowes product. Al this tells me is that it's spring and now some homeowners who can't sell if they wanted to are going to do some minor improvements themselves.

A retail store with too much inventory runs a weekend sale with two-for-one or other discount theme that clears inventory allowing prices to return to normal quickly.  The U.S. had too much residential inventory from the sub prime days. A substantial tax credit of not less than $25,000 would have cleared the inventory within one year and stopped falling home prices from crippling the balance sheets of banks.  Rather than fix housing, our policy makers essentially skipped housing and went to fix Wall Street and the banks.  Not only did this do nothing for Main Street, but it is not a good solution for the banks either.  YOU WILL NOT FIX THE BANKS UNLESS YOU FIX HOUSING.  You fix housing with a substantial tax credit.  This will shift the demand curve to the right and provide the incentive, as well as the down payment money, that potential home buyers currently do not have.  Unlike other stimulus, a tax credit can be monetized at the time of closing and give home buyers the DOWN PAYMENT money they do not have.  This is not to say you make anyone a loan.  That was the problem of sub prime lending.  You still need to underwrite loans effectively and credit score borrowers, but then the tax credit will provide the incentive and the down payment money.

Falling home prices and reduced interest rates is not clearing the inventory of homes on the market.  Rather, falling home prices is simply battering Main Street (as they also see their 401K disappearing).  Falling home prices may be a solution at some point.  The problem is that the banking system, whose equity is based on real estate values, may not survive the declining price scenario.  In any case, what falling prices are doing is battering the balance sheets of banks leading to the contraction in lending that is now battering the economy in general.

The housing problem could have been fixed earlier with substantial tax credits for home buyers.  Instead, back in the fall of 2007, idiots Bernanke and Paulson said the financial crisis was "contained".  Now Geithner is on the same course, providing solutions for Wall Street instead of housing.  

Obama has an agenda completely separate from fixing the economy.  It is disguised under a stimulus program but, as we see, it has nothing to do with stimulus.  He is not trained in economics and simply doesn't understand.  His is fixed on an agenda of wealth redistribution which may be fine as a goal, but it has nothing to do with stimulus.

All problems in economics are self-correcting at some point.  The problem is that falling home prices are resulting in a potentially devastating scenario as money is blindly pumped in to Wall Street and banks to withstand the effect of falling home prices.  A simpler solution would have been to fix housing with a substantial tax credit whidh would have -- stopped the fall in home prices, made Main Street feel better, stopped the write-downs at banks, and finally stopped the credit contraction that resulted from the write downs which is now battering the rest of the economy.

The policy makers late choice of a $7,500 tax credit (really a loan) now converted to an $8,000 tax credit for first time home buyers is insufficient.  The tax credit in this environment needs to be no less than $25,000 applicable to all home buyers.  This wil clear the existing housing inventory as well as foreclosures before they have a chance to accululate on the market.  Efforts to modify loans and prevent foreclosure cannot be achieved at any real scale.  The best solution is for a substantial tax credit which will create a more vibrant housing market and clear foreclosures as well as existing housing inventories allowing a floor under home prices to finally be put in place.

Point 1: My father always told me, "Real estate is a lousy investment, but every person needs his space and God isn't making any more land." The human population is growing and severe pressure has been building on the planet and its resources. In several parts of the world the population will need to stop growing or move out. The vast UNDERVALUED territory of the United States is the vacuum that nature abhors and we're dumb enough and panicked enough to want to sell to ANY bidder.

Point 2: Americans are so busy being caught up in the retail price of the housing market that we have lost sight of what it is and what it's made of. In the first place, a parcel of land and a home is a fairly expensive complex infrastructure. It has a group of manufactured components, including lumber, glass, plastics, metals and more. These components have their costs. It is safe to assume that a piece of real estate MUST be worth at least the sum of its component parts or replacement cost or ANY real estate is a poor investment in the first place. The only way that diminished real estate prices can continue their spiral down is if the sum of the parts becomes less or the need for the real estate in its market has vanished.

Point 3: The infrastructure that is a home may depreciate over time if it is not maintained but its land's intrinsic value (assuming the lack of man made or natural catastrophe such as eminent domain or tornado) MUST grow over time due to the constant pressure of inflation unless the land becomes untenable by permanent flood or toxicity. Whether this value increases slowly or rapidly may be influenced by traditional MARKET pressures but genuine real estate value must ultimately maintain at least par unless population pressures subside.

Point 4: A second thing that my father told me was, " You may meet a good person, or even two, but PEOPLE are no damned good!". Assuming that population continues to grow and outside (meaning pressure by foreign national wealth) demand for American land maintains or increases, then, like always, it's simply a matter of waiting out the panic, stupidity and lack of planning by Americans. While on the surface it is deplorable that banks are bulldozing new homes, in some cases it may make a lot of sense because, "Real estate is a lousy investment but every person needs his space and God isn't making any more land.". In other words, even if real estate becomes less desirable to Americans, to the world, land is VALUABLE!

Point 5: It is very unlikely that this downturn was merely cyclical. The only conclusions that can be reached with the devaluation of land and real estate (at this scale) is that the pricing has outrun the real market value or that human stupidity or engineering of a false crisis was perpetrated to some unknown purpose. I suspect all three reasons were at play. Regardless of the cause, the effect is predictable. The real estate market may be driven below its real market value for a brief span to the benefit of a few, but at some point the plan will find completion and real estate will rebound and find its proper level of valuation.

One only needs to be patient.

I want to say - thank you for this!