"We bought a house to store our furniture in. Not only did we save the money we would pay for storage, but I am sure we will make a nice return on the flip."
- Overheard from guy in Seat 4C on my America West flight from JFK to Phoenix
In hindsight, I should have seen the writing on the wall for the 2000 stock market crash when TVs in the sports bars around the country had switched from ESPN to CNBC. This time around, for the housing bubble, what will the concurrent indicator be? There have been countless pieces written about loose credit, speculative buying, and mounting interest rate pressure. However, when you hear a guy note that he bought a house to store some furniture, that has to signal a top, no?
Hedgestreet is now offering a futures market by which one can short residential housing prices. What do you think? I would be more interested if I could trade in markets I deem to be "purer" than San Francisco, Los Angeles, and New York. Meaning, finite amounts of land in unique places like San Francisco make me hesitant to ever be truly exposed to a naked short. That said, the heartland and mountain states appear to be chock full of cities where irrational real estate exuberance has taken hold.