From: "rick++" 
Newsgroups: misc.invest.real-estate alt.politics.economics soc.retirement soc.culture.usa
Subject: Re: Will home prices fall?
Date: 27 Jan 2005 08:07:20 -0800
   posting-account=baGIGAwAAAB8R7fBjS2dCahJEL6C3Xd6

In southern California, the 1990s housing crash was about 3 years after
the
economic recession.  The recession was caused by a defense industry
bust
(Thank you Mr. Reagan for ending the cold war!) and the business
restructuring
fad of that era.

First people just took their houses off the market.  Falling interest
rates and
refinances slowed it further.  But the steady pressure of "below market
price"
relocations lowered the price of whole market around 30%.

The post-earthquake reconstruction boom and the dot.com boom revived
the
housing market.  In fact it is now the most insane in the country with
about
five years of 20% price increases.

This was a regional bust.  Other parts of the country were doing well
in the 1990s.

Silicon Valley never lost value after the dot.com bust.  But price
rises slowed
for a while.