Back in late 2008, I was contacted by another author of a book on the housing bubble, Bill McKim. He recently emailed me a link to an online video book he produced on the housing bubble, Homemania. Enjoy.
Introduction from Bill McKim on Vimeo.
Step 1 from Bill McKim on Vimeo.
Step 2A from Bill McKim on Vimeo.
Step 2B from Bill McKim on Vimeo.
Step 2C from Bill McKim on Vimeo.
Step 2D from Bill McKim on Vimeo.
Step 3 from Bill McKim on Vimeo.
Step 4 from Bill McKim on Vimeo.
Step 5 from Bill McKim on Vimeo.
Step 6 from Bill McKim on Vimeo.
Step 7 from Bill McKim on Vimeo.
Step 8 from Bill McKim on Vimeo.
Step 9 from Bill McKim on Vimeo.
Canadians Warm to Phoenix
“Canadians are on a Sun Belt shopping spree.”
“For the two years that ended in March, Canadians made up the largest percentage of foreigners buying homes in the U.S.—23%—up from 11% in 2007, according to the National Association of Realtors. Arizona and Florida are the focus of their interest …”
“Americans always seemed to have more money than Canadians,” he said. “What happened?”
Oh, and first post! 🙂
This actually seems quite brilliant. I’ve read vociferously about bubbles, including the housing bubble, and I’ve never seen anyone make some of the connections that this author makes.
I disagree with the author’s Step 3 – a lot of people did not expect home prices to keep going up by double digit percentages. By 2004 I was sure that prices must stop rising, simply because there was no way for most people to keep making the payments. i live in San Diego and it was totally crazy what people were borrowing. (I did not understand at the time the point the author makes – that by that point it wasn’t the people that were paying for the houses, but rather it was the houses that were paying the people). Also I remembered people getting burned in the early 1990’s housing market, so I was definitely not one of those who believed home prices only go up.
I am especially interested in the author’s Step 4, where he seems to be arguing that even the people who saw that there was a bubble and profited from the collapse, actually did not know what was going on. That’s a really interesting point. I personally profited from the bursting of the bubble, because I expected a recession and was shorting stocks in 2007 and 2008. But it’s true, I only had a vague and incomplete understanding of the size and dynamics of what was going on. Thinking I had already made a nice profit, I covered my shorts right before Lehman went tits up; otherwise I would be freaking rich and retired on a beach now. No, I’m not kicking myself for that at all.
We don’t really disagree about “everybody” believing that house prices would always continue to go up at that same dizzying rate. After all, you are, as indicated by the title of this feature of this blog, astute.
I employ the video clips and the long quotation from the LA Times article to illustrate the existence of an almost universal belief at that time that house prices would always go up. The fact that it was so is fundamental to understanding why it was possible for house prices to soar further and futher above house values for so many years.
Thank you for your observation.