Paul Krugman, the well known author and Economics professor, wrote a short but sobering post explaining why the housing slump is far from over. The chart below highlights his point – housing slumps last.
His post also lays out some facts that are tough to argue with:
- Housing prices in real terms are still way above historical norms
- Inventories of unsold houses are still very high
- Previous bubbles, like the LA bubble of the 80s, took years to work off
Not exactly an encouraging fact pattern…
this is scary but true. question is – is the worst behind us or still to come?