TBP- Lots more trouble ahead for US R/E

http://www.ritholtz.com/blog/2010/07/the-4-trillion-dollar-question-2/ Analyst compares mega-trends in US housing market and his expectations are: - LOTS of inventory still needs to move (4 million extra homes but absorption of only .3 mill/year). - No wave of defaults UNLESS rates rise, then watch out below. - The US economy is over-saturated with mortgage backed debt relative to historical... [more]

http://www.ritholtz.com/blog/2010/07/the-4-trillion-dollar-question-2/ Analyst compares mega-trends in US housing market and his expectations are: - LOTS of inventory still needs to move (4 million extra homes but absorption of only .3 mill/year). - No wave of defaults UNLESS rates rise, then watch out below. - The US economy is over-saturated with mortgage backed debt relative to historical trends. Clearly this guy has done yeoman's work on this though I can see a couple of missing calculations: 1 - He might be missing shadow inventory. Not sure of the scope of this today, but aren't there still "flippers" out there holding more than one property waiting for the right price to return? 2 - His inventory analysis should be modified for what would have been a "normal" inventory level in normal times. 1 and 2 probably offset each other to some degree. Still, his numbers don't bode well for a quick return to normalcy in the national R/E market. Also makes me curious about other things. What would such stats like LTV over the whole market look like for Manhattan, NYC and the region? Probably more of a job for Jeff than Noah over at Urbandigs I know this may not be available or possible, but it still has me curious. [less]