The Ripple Effect Of Declining Real Estate

July 7, 2011 06:36

The impact of a double dip, or continuation of Real Estate’s decline, could be more than just economic.  It can bring investor/consumer confidence down.  Declining confidence has been the downfall of many markets. – BI

John Riley, Cornerstone Investment Services at Business Insider


Robert Shiller (of the Case Shiller Housing price index) has stated that he expects to see housing fall an additional 25%.

Once real estate bottoms, whenever that is, it does not mean a return to the housing heyday of 2005.  Many of the factors that contributed to the housing bubble are no longer available.  Easy credit, cooperative appraisers, and loose application rules no longer exist.

So even if, and when, the housing market stabilizes, don’t expect to see a boom.  It just isn’t going to happen.

This means that one of the forces that drove the stock market from the low in 2002 to its peak in 2007 will be missing.


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