KBH: Home Prices May Drop Another 20%

“I don’t think we’re anywhere near a bottom in housing”

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Broad

courtesy of Bloomberg

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Excerpt:

Eli Broad, a philanthropist and co- founder of KB Home, the fifth-largest U.S. homebuilder by revenue, said he expects home prices to drop another 20 percent.

"I don’t think we’re anywhere near a bottom in housing,” Broad told Bloomberg TV at the Milken Institute Conference in Beverly Hills, California. "We’re going to have a big inventory of unsold, unoccupied homes that’s going to take three or four years to clear out.”

Homebuilders, hurt by banks’ stricter requirements for granting home loans and concern over the rising number of homeowners failing to pay their mortgages, have begun work on the fewest number of houses since 1991, according to the U.S. Department of Commerce."

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Source:
KB Home’s Broad Says Home Prices May Drop Another 20%
Rhonda Schaffler and Bob Ivry
Bloomberg, April 28 2008
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aNGtHO1tbzng

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What's been said:

Discussions found on the web:
  1. VennData commented on Apr 29

    Down 20%? Ha. They’ll be up twenty percent if you simply ended the gas tax this summer so people could afford to go out and shop.

    And more fear-mongering about “education” from yet another limousine liberal (aka Private Jet Populist.) Outside of a few teen girls on that ranch in our Commander-in-Chief’s home state no child’s been left behind.

    What we need is a tax cut for kids so they’re properly incentivized. Heck, privatize the whole family structure and free up the creative juices trapped in this old Soviet collectivized way of living.

  2. John McCain commented on Apr 29

    My name is John McCain, and I approve this message

  3. veeder commented on Apr 29

    So the bottom has passed right? Up is down, down is up…

  4. VJ commented on Apr 29

    Down 20%? Ha. They’ll be up twenty percent if you simply ended the gas tax this summer so people could afford to go out and shop.

    * Senator McCain’s federal gas tax holiday would cost the Transportation Trust Fund at least $11 Billion, revenues which are fully dedicated to maintaining our crumbling highway infrastructure.

    * According to the U.S. Transportation Department, every $1 billion of federal highway investment supports 34,779 jobs, ergo it would also cost 382,569 jobs.

    Of course, Senator Clinton has also proposed a federal gas tax holiday, but her plan would be to replace the lost $11 billion to the Transportation Trust Fund with part of the funds raised by a Windfall Profits Tax on the egregious profits that Big Oil has raked in from gouging American consumers, plowing the rest into alternative energy projects.
    .

  5. Mark commented on Apr 29

    he is a honest person.

  6. blam commented on Apr 30

    The housing market continues to be buffetted by the small problem of affordability for real buyers. Remnants of rebel liberals in the former United States continue to assert that the market is the most efficient means of price discovery and resource allocation. The ownership society movement has shown that the Federal Reserve and Treasury can overcome the nattering naybobs with judicious inflation and a risk spreading. A new derivative product dubbed “PTHP Bonds” are expected to stabilize and actually increase housing prices next quarter. (PTHP = Pass the Hot Potato).

  7. ThomasD commented on May 1

    Yep, that’s the way to reduce the price of a manufactured product, through punitive taxation applied to the producer. Especially since corporate taxes are never ever paid by the ultimate consumer.

    And just how the hell can profit be called ‘egregious?’ Don’t you work for a living?

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