I attended the sold out Kern County Economic Summit today. The highlight of the annual event is the presentation made by Dr. Abbas P. Grammy.
Dr. Grammy is forecasting 2007 Kern County median home prices to rise by 2.5%. We will hold his feet to the fire on this one. Dr. Grammy is a distinguished professor and economist, however, he is already wrong on this prediction as Kern County prices have already dropped year-over-year by 2%.
Maybe he is expecting a late rally this year? I am guessing he has not factored in the massive credit tightening, inventory tsunami flooding the local MLS or the significant increase in foreclosures and NOD's?
Also, our median HH income (adjusted for inflation) is the same as it was in 2001, according to his graphs, $38,600. However, our median price has gone from $93,400 in 2001 to $275,700 in 2006. Clearly, this rapid increase in prices was not built on fundamentals, as the fundamental driver of home prices is HH income. This increase was built on cheap and easy credit and fueled by massive speculation.
2 comments:
I really can't think of any group more delusional, misinformed, and full of themselves than most csub professors....or any college professors for that matter. These people typically have no real world experience or evidence to back up their claims. But I do applaud the time they've spent learning and teaching.
That's a good one.
Glad I didn't waste paying good money to go see this little entertainment show (AKA "tell the crowd what they want to hear"). I see it was sponsored by the COC and KCED, not exactly a group that likes to hear bad news (AKA reality).
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