Mohamed Ibrahim’s Blog

An article appeared on the wall street journal online, suggesting that the housing troubles are over. There’s some interesting analysis over there that shows why it is over. Another article appeared yesterday also on WSJ, that shows more charts suggesting that the housing problems are over. This one shows a chart showing that the housing market reached the same bottom from which the housing market bounced up every time. Basically, it applies a similar theory to the support and resistance ideas used in the stock market.

However, there’s a couple of things that tells me we might still go in the flat bottom till the end of 2009. First Fannie Mae just expected prices to further drop. The chart in the second WSJ shows the market bouncing up after a recession, and we’re not in a technical recession yet.

I will update the chart that I used to analyze my local market, and will share it on the weblog. I agree that we are in the market bottom, but I think this bottom will be little bit more flat than just April of 2008.

Standard and Poors released a report showing that the housing prices fell sharply, way sharper than every one expects. What S&P terms “S&P/Case-Shiller home-price index” dropped 10.7% since January 2007, after 9% drop in December compared to a year earlier.

Although this week news came out that existing home sales is one the rise, it seems that there are different type of buyers this time. Buyers are either trying to take significant advantage of the market, or strong investors are buying investments when there’s lots of blood. And I still believe that the market will bounce back, yet it looks this time that there’s a different type of bouncing back. There will be a lot of sales at low price first, then the price will start following as demand increases.