housing market correction coming?

[brick]

"The inventory of unsold houses rose to the highest level in nearly 20 years."

Any thoughts on whether we will have a significat correction in the housing markets vs period of slower growth?

How can I best position myself to take advantage of a correction?

http://news.yahoo.com/s/nm/20051128/...kets_stocks_dc

in bubble areas you will see correction, in others, slow growth most likely

[BarkingMad]

I have a friend whose opinion I value highly when it comes to stuff like this. He's an economist who got his degree from the London School of Economics, he own real estate here in Seattle, and trades stocks for a living from his home in Alki.

I asked him this very question over beers awhile back and he thought that Seattle RE was susceptible to a market correction (not just slow or no growth).

The good news is that (in his opinion) some of the hotter markets like LA & the SF Bay area will be a leading indicator for the rest of the country if a RE correction does hit. His thought was that there would be a lead time of about 6-12 mo. from the time LA RE starts sliding south to when we will feel it here in Seattle.

How to best profit from a correction, I suppose, would be to sell all your RE and get into a mutual fund like ProFunds RE Inverse fund.

I don't know what exactly I'm going to do if things go south, but I'm keeping an eye on California.

From north of the city,

BM

[Scotty O]

[ QUOTE ]
"The inventory of unsold houses rose to the highest level in nearly 20 years."

Any thoughts on whether we will have a significat correction in the housing markets vs period of slower growth?

How can I best position myself to take advantage of a correction?

http://news.yahoo.com/s/nm/20051128/...kets_stocks_dc

[/ QUOTE ]

Bubble should have popped a long time ago...
Hold onto your seats New England

actually best way imo to profit from possible correction would be to buy deeply discounted foreclosured houses if you can get them and flip them for below mkt prices to ensure a quick sell.

[NoTalent]

puts, lots of puts

growth in my area is rediculous, i got my place feb 04 for 267k and if i wanted to could probably get 550k for it, tho i love the area and don't want to move.

[cdxx]

[ QUOTE ]
The good news is that (in his opinion) some of the hotter markets like LA & the SF Bay area will be a leading indicator for the rest of the country if a RE correction does hit. His thought was that there would be a lead time of about 6-12 mo. from the time LA RE starts sliding south to when we will feel it here in Seattle.

[/ QUOTE ]

some areas will start sliding ahead of california, because california is also a desirable place to live, so the bubble accounts for only some of the growth. for example, DC Metro is already sliding. many (myself included) think that particular area is almost all housing bubble. there's population growth, but it is my understanding that the same people who were renting a loft apartment with three roommates only a year ago are now speculating by owning 2 or 3 houses and renting the rooms in order to make the mortgage payments. that's practically the definition of bubble. also, 6 months ago a house would be on the market for an average of 1 week, and is now longer than a month.

draw your own conclusions.

another key statistic to look at is the affordability index, which is rediculously high in some areas.

[Uglyowl]

[ QUOTE ]


Bubble should have popped a long time ago...
Hold onto your seats New England

[/ QUOTE ]

Awfully big area you are concerned about when only the Boston area is insane right now.