2011 - Home Prices still 20% too High - Peter Schiff
Writing in the Wall Street Journal, Schiff breaks down the horrible state of the U.S. residential real estate market just days after a negative Case-Shiller number pretty much confirmed we’re in a housing double-dip.
Schiff explains that, if we all believe that we were in a housing bubble, then house prices need to come back to the historical trend line before we’re actually through this.
But that 20.3% is only the beginning of the break.
From Peter Schiff (in the WSJ, emphasis ours):
With a bleak economic prospect stretching far out into the future, I feel that a 10% dip below the 100-year trend line is a reasonable expectation within the next five years, particularly if mortgage rates rise to more typical levels of 6%. That would put the index at 114.02, or prices 28.3% below where we are now. Even a 5% dip would put us at 120.36, or 24.32% below current prices. If rates stay low, price dips may be less severe, but inflation will be higher.
http://www.businessinsider.com/peter-schiff-home-prices-2010-12