Crashing Home Prices

My Shabbats used to be ruined by sitting at someone’s table and listening to them moan about the high price of Pico/Robertson real estate and how they had to sell off their first-born child to make their downpayment.

Just imagine you, an old bloke married to the same sheila for 35 years, and you had to sit at a Shabbat table with a young single man who spent the whole meal complaining about how empty he felt inside due to all the promiscuous sex he was having with slutty shiksas.

I suspect you wouldn’t feel a great deal of sympathy. To you, after 35 years of bondage, every other woman in the world looks amazing.

I remember this old married bloke in shul telling me that a certain young single woman on the other side of the mehitza — a complete plain Jane — looked like Nicole Kidman.

"After I’ve been married for 25  years," I responded, "every woman in the world aside from my wife will look like Nicole Kidman too, mate."

I’ve never had real estate problems and never will just as you, the old married bloke, will never be afflicted with the inner emptiness that comes from too much meaningless sex.

I’m very spiritually sensitive to this kind of narishkeit, knowing I’ll never have home problems unless I marry money.

I’m doomed to live off women for the rest of my life.

Not easy for an aging twink.

Anyway, these days my Shabbats are ruined when I sit around people’s tables and they whinge about the plunging price of real estate.

Will nothing satisfy these Jews?

What a stiff-necked bunch.

If I were G-d, I would’ve left ’em in the desert.

Was it for this that Joshua blew his trumpet?

Was it for this that we painted blood over our lintels?

Was it for this we survived Auschwitz?

To complain over real estate?

As my regular readers know, my blog is a complaint-free zone.

Whinging is not spiritual.

We each have our cross to bear and we shouldn’t complain about it.

From today’s Los Angeles Times:

WASHINGTON — Nearly two years into a housing decline that has resulted in hundreds of thousands of foreclosures, frozen credit markets and dragged the nation’s economy toward recession, many Americans hope the end is near.

"I see absolutely no signs of a bottoming, either nationally or in the regions," said Patrick Newport, who tracks the housing market for Global Insight, an economic forecasting firm in Lexington, Mass.

Elsewhere in the economy, some analysts find encouraging signs. "The housing correction is still going to be with us this time next year," said Celia Chen, a housing economist at Moody’s Economy.com in West Chester, Pa.

"When it comes to housing, the optimists are those who see the near free fall in home prices as encouraging: It may at least shorten the economic agony.

"Because the prices are going down so fast, we’ll be hitting the stabilization point sooner," said Lawrence Yun, chief economist at the National Assn. of Realtors.

The hard truth is that the housing correction is turning out to be deeper and longer than nearly anyone anticipated. With every month of lower home prices, homeowners see their net worth decline. Already, several major retailers tied closely to housing — furniture chains such as Levitz Furniture and home improvement stores including Home Depot Inc. — have gone out of business or suffered big losses. Economists estimate that the housing downturn has dragged the country’s gross domestic product down by about 1 percentage point for the last year.

"People’s ability to spend depends in part on their housing wealth," Baker said. Economists say consumer spending is the economy’s main driver, accounting for about 70% of GDP.

How much longer will home prices fall, and how much further?

"Housing is the biggest risk to our economy," he said.

Before the mid-1990s, he said, house prices moved up roughly in line with inflation. Thomas Lawler, a housing economist who runs a consulting firm in Leesburg, Va., noted that in the last housing price correction, which occurred in the early 1990s, it wound up taking prices seven years to drop 20%. Compared with that protracted slump and recovery, he thinks the current free fall in home prices is a good thing.

How long will homes need to be on the market before sellers are willing to drop their prices low enough to find buyers? Lawler believes that the government should help ease the liquidity crisis facing banks but should stay out of the housing market itself. Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, said Congress’ goal was to reduce the effect of the housing crisis on the overall economy. "We’re not trying to stop housing prices from dropping," Frank said in a recent interview. Nicolas Retsinas, director of Harvard University‘s Joint Center for Housing Studies, noted that a downturn in construction had already led to layoffs in related industries and that declines in house values were already draining local budgets for schools and roads.