When and where is the bottom in housing?

We are all interested in as to when this housing crisis will bottom out. I was reading today this article "Has Housing bottomed? Here's how to tell" on  OfTwominds.com blog by Charles Hugh Smith, whose website I frequent regularly. His ideas are insightful and thought provoking (clicking on the title of this blog entry will take you to the article.) We have been among those who wanted to buy our first house, but so far never mustered the courage to buy. Though  we have been living in US for more than 12 years, we have always found more reasons not to buy. Probably the strongest reason might be that we have been living in Bay area, where the housing is one of the most expensive in the country. Experts say that you have to have at least 20% down payment before you can think of buying. You also read you should have 6 months of living expenditure in your savings.

One of my friends said that there is no point in calculating how much your house is worth, as long as you are living in it. It is of use only when you try selling it because of upgrading or downgrading or moving out of the State/Country. We always thought that we should buy a house because we would want to live in it. We do not know when we will buy a house, but recently once again decided that we still are not ready to buy as yet, not because the housing is still not affordable, but because it gives us freedom and mobility.

Responsibly irresponsible.

This was a post that I wrote on 18th March 2009. I think this is relevant even now.


When I read the comments by Nouriel Roubini in the article in Forbes today, it set me thinking. When we do individually, what we are doing collectively in the name of saving the economy, isn't it called being irresponsible? What we are going through now and what is being done to escape the reality is so full of contradictions that no one can for sure say, ultimately that we will be able to avoid the Deep Recession or Depression that we are already in. But at the same time we have to do something and the Government has to also do something.

We can not just watch what happens and think that this was inevitable. We are supposed to be responsibly irresponsible to get this economy out of this mess. We should not spend beyond our means but at the same time we should not cut down too much. We have to do the right thing collectively as a nation and the world. How is this possible? I think it is impossible because we are not like computers. We ultimately have to go through the pain anyway, like a disease which has to run its' course.