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Loose Lips Sink Real Estate Markets

The housing market is now being characterized as a super tanker or large ship.

I was humored by the Lereah changes metaphor – Real estate is now a ship, not a balloon [Northern NJ RE Bubble Blog] [1] post which takes a quote from the NAR Chief Economist [Reuters] [2] who says:

Changes in the overall direction of the housing market are akin to a large ship making course corrections — it takes some time for the driving factors to materialize as a change in the sales level.

This comes after his recent pronouncement that we are in a housing expansion [Matrix] [3]. However, that description did not gain traction, and in fact did more damage to NAR credibility trying to be the lighthouse in the dark and stormy night [Matrix] [4]. [Sorry about that]

Actually I am not sure that the ship analogy is accurate. I don’t think that housing markets always take long periods of time to change as the ship comparison would suggest. However, I think it does take a long time for market participants to accept change, especially when the market has been largely unchanged for several years.