Sunday, February 27, 2005

But is he selling his house?

Hereabouts, housing prices just keep racing along.

Michael Kinsley, one of my favorite sexists, says that the housing boom is over. Why? Because no one worries about it ending anymore, and we all need better stories to tell:
It is obvious to me that today's real estate prices are a speculative bubble that is bound to burst. Of course, this has been obvious to me for about three decades and wrong almost all of that time. Nevertheless. One piece of evidence is the Dinner Party Index. The boom is over when more people are bored by real estate anecdotes ("My next-door neighbor got three times her asking price before she even put it on the market, from a professional mind reader who divined that she was thinking about selling. . . .") than have new ones.

Another reason the value of your house is about to plunge is that the Los Angeles Times, the New York Times and The Washington Post all say that it isn't. A recent L.A. Times article reported that the median price of a local house had gone up only 17 percent in the past year. Headline: "L.A. County Home Prices Cool Slightly." Subhead: "Slowdown may not last."
Actually, he seems to really think the housing market is about to collapse:
Like a roller coaster, a financial bubble has a moment of eerie stillness at the top. Buyers have adjusted, sellers haven't. So sales dry up. When the New York Times spins a surplus of unsold houses as a sign that "the ongoing problem of a lack of houses for sale" has been solved, it means that you had better not count on the Times to tell you when it's time to bail.
In our market, though, it doesn't look like there are too many houses on the market -- instead, the listings look a little thin here (and elsewhere?). Maybe that's why the SF Chronicle says Kinsley is wrong.

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