Home Prices as a Roller Coaster!

     Have you ever heard the metaphor that home values are like a roller coaster?

     Well now you'll experience what it feels like to be on that roller coaster!   

     I found this video that really brings the statistics to life (see the link below).  It illustrates the ups and downs of home prices as the hills and valleys of a wild roller coaster ride.   I wish I could take credit for this idea but I found it on You Tube. 

     An economist named Robert Schiller, who attended Yale University (in my great home town of New Haven, Connecticut) graphed the values of existing home prices since 1890.  This shows appreciation and depreciation adjusted for inflation and other economic factors, not just value.  Basically when the line goes up homes appreciated faster, and when the line goes down - well, you get the swing of it!  

     You make a lot of money when you buy low and sell high.  To put it in context every time this roller coaster is at the bottom of a big hill it's time to buy, buy, buy!  The red-hot housing market, and the roller coaster in the video, ended in 2005.  If it extended further we'd see an incredibly steep drop over the last two years, but probably not a prolonged drop.  We've come down that huge hill and evidence points to the fact that we're at the bottom. 

     Wealthy investors have jumped back into the housing market and are buying foreclosed properties with wild abandon.  The question is will you be sitting at the front of the roller coaster as it climbs the next big hill of home appreciation?  Or will you be puking by the bumper cars because you ate too many corn dogs and cotton candy?  

Now the fun part.  Enjoy the ride!

Real Estate Roller Coaster