[ThePythonicCow]

What’s your take on the housing market in the next year or so?

My guess is that the high priced areas are perhaps half way down, and that already reasonably priced areas (which have declined little so far) will take a more moderate hit over the next year, as

• financing continues to get even scarcer,
• hundreds of lending banks fail,
• inflation starts to push up mortgage rates,
• unemployment and recession cut into the pool of financially healthy buyers, and
• more sensible lending requirements cut out the financially unhealthy buyers.

[ThePythonicCow]

Then, after a year or so, the housing market will have bottomed, but with the massive overhang of unsold homes and homes that the owner would like to have sold earlier, but held off, it will take a few years to get the prices to start climbing up much.

The main force pushing up the prices will be the inflation that is, in my view, inescapable, as inflation is the only way we can reduce to a manageable level the impact of our current debt, and of our unfunded liabilities for Social Security, Medicare and various retirement fund commitments.