If you’ve ever been mountain climbing, or even if you’ve only just drawn mountains, you should understand the concept of peaks and troughs. You see, you can be climbing up a mountain and still have times where you need to climb down. It’s the nature of the terrain – if you look closely it’s full of bumps and dips, but in the big picture it’s all uphill.
So it is with real estate. The home price index released recently shows that prices rose almost 1% in August. That’s 2% more than last year, when counting 20 major metro areas. That’s the uphill in the small scale. But if you pull things back a bit, you get some bumps.
If you look back to 2008 (and during election season who isn’t?) you see that prices are still down 13%. And if you go back even further to 2006 you see that we’re down 30%.
These aren’t just random times and they aren’t random numbers. We’re talking about the peaks and the troughs. But which way are we headed in the big picture? Are these small gains just ups while we head down or are we heading up after a big down?
It’s been the topic of this blog for years and you guys have been debating it in these very pages. How long will we have to wait to see who’s right? When will the housing market take a clear direction? It’s anybody’s guess right now so why don’t you weigh in?