Transcript:
Interviewer: You don’t think housing is on the road to recovery?
Shiller: I think it might be. There are a lot of positive indicators. People tend to overreact to these, and if you look at the trend down since 2006, it’s a pretty strong trend that we have to see reversed. You know maybe, you know, I might call it later this year that we’ve reached the bottom, but I’m not ready yet.
Interviewer: So this is an important note here. You’re considered one of the foremost experts on housing. Robert Shiller, as you sit here right now, you’re not willing to say that housing is back?
Shiller: Well, we’ve seen four attempts at recovery ever since the subprime crisis. But it’s seasonal. The seasonal has gotten stronger, it’s been growing, so nobody knows why and during the summer season, the question is, will this continue through the fall and winter? We’ll wait and see. If that happens, then, you know, I believe in momentum in the housing market. and we are starting — it looks like upward momentum, but I think it’s too soon to call.
Interviewer: What’s the tell then? what do you need to see before you’re willing to say that we’ve turned the corner for real?
Shiller: It least a solid year of price increases. and maybe other indicators, as well. but the other — it’s starting to look better. I have to admit. so, you know, for someone who is thinking of buying a home now, you also have to factor in that mortgage rates are at record lows. so, you know, I’m not telling people not to buy a house.
The video:
I think Shiller is being rightfully cautious here. The interviewer is sort of desperate to get Shiller to say yes the bottom is housing is in. Even if you got Shiller to say yes the bottom is in, does it really matter. What buyer is sitting out there saying oh I was just waiting for Shiller to confirm the bottom, I’m going to run out and buy anything I can find right now.
Housing prices used to move extremely slow. The bubble and pop made it exciting but you’d expect housing prices to start being a relatively boring topic again sometime in the future.
Classic: “…I’m not telling people not to buy a house”.
The bummer is that by the time he has the cajones to say “it’s time”, it will be too late.
I don’t know, taxes are going to go up pretty much for everyone come January 1st that will definitely pull the wind out of our sails.
it will be too late.
No, you’ll have plenty of time. Housing bottoms tend to be long, and the general economy turns up well before housing does.