No one can predict the future. How can you tell the difference between the Boy Who Cried Wolf and the predictors of the March 2001 Tech Bubble burst? With your 20-20 hindsight glasses… that’s how. The same can be said for the folks who are calling for the housing bubble to burst as well. Some telltale signs are there, of course, but housing isn’t as centralized as stock markets, or tulip bulb markets, and the transaction speeds aren’t nearly as quick. David Lereah, the National Association of Realtor’s chief economist, in an article for USAToday, “predicts the heady gains will cool as interest rates rise.” Did you know he just published a book title Are You Missing the Real Estate Boom? : Why Home Values and Other Real Estate Investments Will Climb Through The End of The Decade – And How to Profit From Them  in February of 2005?
I’m not saying Lereah is wrong nor am I saying he’s right. His book (based on the summary I read) discusses how real estate will appreciate but not at the astronomical numbers that we’ve seen lately. In that respect he’s not wrong. (yet, and I hope he’s not wrong)
That being said, I continue to say what I’ve always said – if you’re speculating with real estate then you’re gambling. The odds might be in your favor, they might not be, you don’t know for sure. If you’re buying a condo and waiting to sell it in a few months for some profit… you may be in for a rude awakening. If you’re buying a condo so you can live in it, that’s a different story. Are some markets cooling? Yes. Inventories are up in many areas, time on market has lengthened, and prices are being readjusted lower including some perks thrown in like closing cost aid and the like.