Comments on: Update: Boom and Bust Cycles Across Markets http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/ News & discussion about real estate & the housing bubble in the Seattle area. Sat, 21 Nov 2009 10:02:55 -0800 http://wordpress.org/?v=2.8.6 hourly 1 By: Mark L http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61451 Mark L Fri, 21 Nov 2008 21:38:41 +0000 http://seattlebubble.com/blog/?p=3418#comment-61451 One simple math thing to keep in perspective - a 100% appreciation is negated by a 50% decline. A 50% appreciation is negated by a 33% decline, and so on. If you draw that line on the chart, only Detroit falls under it - i.e. Detroit is the only market with no net appreciation since 9/01.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61451','Mark L',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61451','Mark L','One simple math thing to keep in perspective - a 100% appreciation is negated by a 50% decline. A 50% appreciation is negated by a 33% decline, and so on.\r\n\r\nIf you draw that line on the chart, only Detroit falls under it - i.e. Detroit is the only market with no net appreciation since 9\/01.',''); return false;">Quote</a></div> One simple math thing to keep in perspective – a 100% appreciation is negated by a 50% decline. A 50% appreciation is negated by a 33% decline, and so on.

If you draw that line on the chart, only Detroit falls under it – i.e. Detroit is the only market with no net appreciation since 9/01.

Reply – Quote
]]> By: Interloper http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61430 Interloper Fri, 21 Nov 2008 17:46:56 +0000 http://seattlebubble.com/blog/?p=3418#comment-61430 I like this a lot, shows there's a real linear relationship between boom and bust. What's most interesting is the outliers -- the exceptions that prove the rule: - the DETROIT market, which has become increasingly undesirable as a place to live - the NEW YORK market (where housing potential may plummet after the data period because of the financial crisis) - the SEATTLE/PORTLAND market, which was booming late and should bust late PS Of course the slope line will get steeper; since the time periods of the two axis are different, the slope will ntaturally increase as long prices decline. It doesn't mean the rate of decline is increasing.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61430','Interloper',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61430','Interloper','I like this a lot, shows there\'s a real linear relationship between boom and bust.\r\n\r\nWhat\'s most interesting is the outliers -- the exceptions that prove the rule:\r\n\r\n- the DETROIT market, which has become increasingly undesirable as a place to live\r\n- the NEW YORK market (where housing potential may plummet after the data period because of the financial crisis)\r\n- the SEATTLE\/PORTLAND market, which was booming late and should bust late\r\n\r\n\r\n\r\n\r\nPS Of course the slope line will get steeper; since the time periods of the two axis are different, the slope will ntaturally increase as long prices decline. It doesn\'t mean the rate of decline is increasing.',''); return false;">Quote</a></div> I like this a lot, shows there’s a real linear relationship between boom and bust.

What’s most interesting is the outliers — the exceptions that prove the rule:

- the DETROIT market, which has become increasingly undesirable as a place to live
- the NEW YORK market (where housing potential may plummet after the data period because of the financial crisis)
- the SEATTLE/PORTLAND market, which was booming late and should bust late

PS Of course the slope line will get steeper; since the time periods of the two axis are different, the slope will ntaturally increase as long prices decline. It doesn’t mean the rate of decline is increasing.

Reply – Quote
]]> By: David Losh http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61415 David Losh Fri, 21 Nov 2008 01:30:27 +0000 http://seattlebubble.com/blog/?p=3418#comment-61415 Funny chart, what's it do?<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61415','David Losh',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61415','David Losh','Funny chart, what\'s it do?',''); return false;">Quote</a></div> Funny chart, what’s it do?
Reply – Quote
]]> By: Matthew http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61410 Matthew Thu, 20 Nov 2008 23:09:32 +0000 http://seattlebubble.com/blog/?p=3418#comment-61410 People in the United States and even more so in the Seattle area have no idea how bad this is going to get before the deleveraging is finished. We are just beginning to see the effects on main street, but yet people are acting like this a temporary blip on the radar. Very hard economic times are coming to this region, its going to get worse than most people realize before we recover.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61410','Matthew',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61410','Matthew','People in the United States and even more so in the Seattle area have no idea how bad this is going to get before the deleveraging is finished. \r\n\r\nWe are just beginning to see the effects on main street, but yet people are acting like this a temporary blip on the radar. \r\n\r\nVery hard economic times are coming to this region, its going to get worse than most people realize before we recover.',''); return false;">Quote</a></div> People in the United States and even more so in the Seattle area have no idea how bad this is going to get before the deleveraging is finished.

We are just beginning to see the effects on main street, but yet people are acting like this a temporary blip on the radar.

Very hard economic times are coming to this region, its going to get worse than most people realize before we recover.

Reply – Quote
]]> By: softwarengineer http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61406 softwarengineer Thu, 20 Nov 2008 21:40:59 +0000 http://seattlebubble.com/blog/?p=3418#comment-61406 THE DOWNWARD SEATTLE AREA PRICE TRENDS SHOULD ACCELERATE AT A HORRIFYING RATE Even Dr. Doom (Roubini) didn't predict a 7000 type DOW until next year. Its already 7500 and 2008 has a month more of declines? When stocks collapse, I predict Seattle real estate will follow in a similar percent loss, with this credit crisis from over-growth and wage mitigation [let alone mass lay-offs].<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61406','softwarengineer',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61406','softwarengineer','THE DOWNWARD SEATTLE AREA PRICE TRENDS SHOULD ACCELERATE AT A HORRIFYING RATE\r\n\r\nEven Dr. Doom (Roubini) didn\'t predict a 7000 type DOW until next year. Its already 7500 and 2008 has a month more of declines?\r\n\r\nWhen stocks collapse, I predict Seattle real estate will follow in a similar percent loss, with this credit crisis from over-growth and wage mitigation [let alone mass lay-offs].',''); return false;">Quote</a></div> THE DOWNWARD SEATTLE AREA PRICE TRENDS SHOULD ACCELERATE AT A HORRIFYING RATE

Even Dr. Doom (Roubini) didn’t predict a 7000 type DOW until next year. Its already 7500 and 2008 has a month more of declines?

When stocks collapse, I predict Seattle real estate will follow in a similar percent loss, with this credit crisis from over-growth and wage mitigation [let alone mass lay-offs].

Reply – Quote
]]> By: The Tim http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61405 The Tim Thu, 20 Nov 2008 21:29:23 +0000 http://seattlebubble.com/blog/?p=3418#comment-61405 Re: Captain Kirkland @ 6, I agree, this is a cool chart, but I should point out that it's Deejayoh's work, not mine (note the "Posted by deejayoh" bit under the headline).<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61405','The Tim',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61405','The Tim','Re: Captain Kirkland @ 6,\r\n\r\nI agree, this is a cool chart, but I should point out that it\'s Deejayoh\'s work, not mine (note the \"Posted by deejayoh\" bit under the headline).',''); return false;">Quote</a></div> Re: Captain Kirkland @ 6,

I agree, this is a cool chart, but I should point out that it’s Deejayoh’s work, not mine (note the “Posted by deejayoh” bit under the headline).

Reply – Quote
]]> By: vboring http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61403 vboring Thu, 20 Nov 2008 21:11:03 +0000 http://seattlebubble.com/blog/?p=3418#comment-61403 Maybe it'd be useful to label each decline from peak with the time since peak. Seattle hasn't fallen the same amount as Portland, NY, or San Fran, but part of that is because they hit their peak prices more or less recently. Or it may be interesting to compare annualized rates at which prices are falling vs annualized price increases. This would correct for differences in timing.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61403','vboring',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61403','vboring','Maybe it\'d be useful to label each decline from peak with the time since peak.\r\n\r\nSeattle hasn\'t fallen the same amount as Portland, NY, or San Fran, but part of that is because they hit their peak prices more or less recently.\r\n\r\nOr it may be interesting to compare annualized rates at which prices are falling vs annualized price increases. This would correct for differences in timing.',''); return false;">Quote</a></div> Maybe it’d be useful to label each decline from peak with the time since peak.

Seattle hasn’t fallen the same amount as Portland, NY, or San Fran, but part of that is because they hit their peak prices more or less recently.

Or it may be interesting to compare annualized rates at which prices are falling vs annualized price increases. This would correct for differences in timing.

Reply – Quote
]]> By: Timber http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61400 Timber Thu, 20 Nov 2008 20:41:30 +0000 http://seattlebubble.com/blog/?p=3418#comment-61400 Nice chart. It shows we are making the proper decline, but we are just behind the rest in terms of the amount of time we have been declining. Don't worry though we will catch up.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61400','Timber',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61400','Timber','Nice chart. It shows we are making the proper decline, but we are just behind the rest in terms of the amount of time we have been declining. Don\'t worry though we will catch up.',''); return false;">Quote</a></div> Nice chart. It shows we are making the proper decline, but we are just behind the rest in terms of the amount of time we have been declining. Don’t worry though we will catch up.
Reply – Quote
]]> By: patient http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61399 patient Thu, 20 Nov 2008 19:59:43 +0000 http://seattlebubble.com/blog/?p=3418#comment-61399 No not exactly. I would like to see max recorded decline, not decline from peak to today. Some markets has an uptick and that makes for a strange correlation and it will get real strange when more markets start turning upwards. What to me is interresting to see is the correclation between aggregated appreciation and max decline. For most markets that's what it is but not for some which can tip the line to represent something undefined.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61399','patient',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61399','patient','No not exactly. I would like to see max recorded decline, not decline from peak to today. Some markets has an uptick and that makes for a strange correlation and it will get real strange when more markets start turning upwards. What to me is interresting to see is the correclation between aggregated appreciation and max decline. For most markets that\'s what it is but not for some which can tip the line to represent something undefined.',''); return false;">Quote</a></div> No not exactly. I would like to see max recorded decline, not decline from peak to today. Some markets has an uptick and that makes for a strange correlation and it will get real strange when more markets start turning upwards. What to me is interresting to see is the correclation between aggregated appreciation and max decline. For most markets that’s what it is but not for some which can tip the line to represent something undefined.
Reply – Quote
]]> By: Captain Kirkland http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61398 Captain Kirkland Thu, 20 Nov 2008 19:59:13 +0000 http://seattlebubble.com/blog/?p=3418#comment-61398 Great Chart, Tim!!<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61398','Captain Kirkland',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61398','Captain Kirkland','Great Chart, Tim!!',''); return false;">Quote</a></div> Great Chart, Tim!!
Reply – Quote
]]> By: deejayoh http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61395 deejayoh Thu, 20 Nov 2008 19:32:51 +0000 http://seattlebubble.com/blog/?p=3418#comment-61395 Patient - If I understand your comment correctly - I think what you describe is precisely what is on the chart. Appreciation from 2001 to peak vs. decline from peak to today.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61395','deejayoh',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61395','deejayoh','Patient - If I understand your comment correctly - I think what you describe is precisely what is on the chart. Appreciation from 2001 to peak vs. decline from peak to today.',''); return false;">Quote</a></div> Patient – If I understand your comment correctly – I think what you describe is precisely what is on the chart. Appreciation from 2001 to peak vs. decline from peak to today.
Reply – Quote
]]> By: patient http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61393 patient Thu, 20 Nov 2008 19:13:32 +0000 http://seattlebubble.com/blog/?p=3418#comment-61393 Interresting graph though I would suggest to plot the biggest recorded decline from peak for each market otherwise it becomes a pretty weird representation. The aggregated appreciation and the max decline to date would present a more interresting correlation.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61393','patient',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61393','patient','Interresting graph though I would suggest to plot the biggest recorded decline from peak for each market otherwise it becomes a pretty weird representation. The aggregated appreciation and the max decline to date would present a more interresting correlation.',''); return false;">Quote</a></div> Interresting graph though I would suggest to plot the biggest recorded decline from peak for each market otherwise it becomes a pretty weird representation. The aggregated appreciation and the max decline to date would present a more interresting correlation.
Reply – Quote
]]> By: deejayoh http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61392 deejayoh Thu, 20 Nov 2008 19:09:03 +0000 http://seattlebubble.com/blog/?p=3418#comment-61392 Hard to read on the image w/r/t "fit" R^2 for May = 0.4725 R^2 for August = 0.5489<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61392','deejayoh',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61392','deejayoh','Hard to read on the image w\/r\/t \"fit\"\r\n\r\nR^2 for May = 0.4725\r\nR^2 for August = 0.5489',''); return false;">Quote</a></div> Hard to read on the image w/r/t “fit”

R^2 for May = 0.4725
R^2 for August = 0.5489

Reply – Quote
]]> By: vboring http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61391 vboring Thu, 20 Nov 2008 18:28:02 +0000 http://seattlebubble.com/blog/?p=3418#comment-61391 another implication of the improving "fit" is that means that all real estate follows the same trends. i.e. all real estate is national, not local<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('61391','vboring',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('61391','vboring','another implication of the improving \"fit\" is that means that all real estate follows the same trends.\r\n\r\ni.e. all real estate is national, not local',''); return false;">Quote</a></div> another implication of the improving “fit” is that means that all real estate follows the same trends.

i.e. all real estate is national, not local

Reply – Quote
]]> By: jon http://seattlebubble.com/blog/2008/11/20/update-boom-and-bust-cycles-across-markets/#comment-61387 jon Thu, 20 Nov 2008 18:05:36 +0000 http://seattlebubble.com/blog/?p=3418#comment-61387 “The “fit” of the line also got better – meaning markets generally moved closer to the line”

Seems to me most cities moved away from the old line. Denver, Dallas, and Boston were above the line and moved up, and all the cities at the bottom moved down, especially the ones that where already below the line.

Reply – Quote
]]>