Dear bears,

It makes sense to agree that we can expect the RE prices will go down or at least will not go up in the near future, based on the current market trend.

It will help me and many others who are waiting to buy a house, if we can identify when the prices start going up again. Because the greedy builders and more than them, the brokers may raise the prices like anything from the current market levels.

So can you please suggest how to identify the bottom of market prices?

Regards,
Elite who wants to be enlightened
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  • Originally Posted by elite
    Dear bears,

    It makes sense to agree that we can expect the RE prices will go down or at least will not go up in the near future, based on the current market trend.

    It will help me and many others who are waiting to buy a house, if we can identify when the prices start going up again. Because the greedy builders and more than them, the brokers may raise the prices like anything from the current market levels.

    So can you please suggest how to identify the bottom of market prices?

    Regards,
    Elite who wants to be enlightened


    all predictions are based on presumptions,assumptions and "what happened then will happen now" and varies over a wide spectrum of estimates.

    the bears and the bulls both have been miserably proved wrong both in the boom and slump and RE is a conundrum which has baffled the wise and the mighty.

    take all predictions with a pinch of salt

    nice rhyming words DEAR BEARS or BEAR DEARS
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  • This was already posted ...

    Originally Posted by abk
    all predictions are based on presumptions,assumptions and "what happened then will happen now" and varies over a wide spectrum of estimates.

    the bears and the bulls both have been miserably proved wrong both in the boom and slump and RE is a conundrum which has baffled the wise and the mighty.

    take all predictions with a pinch of salt

    nice rhyming words DEAR BEARS or BEAR DEARS



    Let us go back in History and check similar situations. Way back, in 1995 prices peaked and then crashed till late 1998.

    Though the bottom of the market was seen in prices around late 1998 these remained stagnant till almost 2002 with hardly any improvement in prices. You will also note that there was this humongous boom in the Stock Markets (Dot com boom) and we can conjecture that a lot of money was diverted from RE to the Stock Markets.

    Subsequently, in the ensuing crash, sentiment as well as prices remained low and stagnated for quite a long time. Please note this important point. It is only when the Stock Markets bottomed out in 2002 that the simultaneous boom in both markets took off - only now we know that it was fueled largely by excessive and reckless credit which enabled people with 60k salaries buy 1 crore apartments, one of the most ridiculous things I have seen in my life, merely under the belief that salaries and credit will rise forever couple with the belief that there is always a greater fool at ever-increasing prices.

    So, in conclusion booms (even in RE) happen only when the economic climate is "clear blue sky" with bright sunshine. Right now it is "heavily overcast sky" with continuing heavy rains forecast. In such situations prices will stagnate and decline till economies bottom out and thats some time away - maybe in the 2010 - 2012 timeframe.

    We now know that everything that goes up comes back down eentually and the higher they go, the harder they fall.

    So, keep track of prices every quarter and you can safely assume that if prices remain stagnant over 4 successive quarters the bottom is probably in, provided in addition, the world economy has also bottomed out and markets are starting to make higher bottoms and tops.

    You will have all the time in the world to buy at the bottom as prices will stagnate long enough for you to move in. So, don't get panicked by the bulls who are still telling you that if you don't jump and grab today, you will miss the bus. The bus is still to arrive at the terminus and when it does, it will stick around for quite a while so you can get in at leisure when you have ensured financial strength.

    cheers
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  • Originally Posted by wiseman

    So, keep track of prices every quarter and you can safely assume that if prices remain stagnant over 4 successive quarters the bottom is probably in, provided in addition, the world economy has also bottomed out and markets are starting to make higher bottoms and tops.



    Thanks for reminding the history, Wiseman. I am quite clear on "markets are starting to make higher bottom and tops". How is it possible to see both higher bottoms and tops at the same time?

    abk,

    I just wanted to keep Nats away from the reply even though our native is same..:) Thats why the phrase 'Dear bears'..

    cheers!
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