housingpanic, one of the real estate bubble blogs, disagrees with me, “Idiot Phoenix realtor says housing was not a bubble because it’ll only drop 10%.”

See his comments on this post of mine.

I’ve copied by response comment below.

housingpanic, thanks for the comment.

Oh dear god anyone who buys today in Phoenix and sells within five years will be bankrupted by your “Buy” sgnal.

Prices may indeed go lower. My recommendation if you listen to it was that if you have been planning to buy in the last few months but were worried about prices, or you were planning to buy in the next 6 months, then the next month or two would be a good time to consider buying.

That is, if you were planning to buy next spring , for example, I would suggest you seriously consider buying right now instead.

Tell you what, if you’re such a bull, tell us what properties you’re out buying today with your own money.

The vast majority of buyers today are owner-occupants and that’s who I’m talking to. I didn’t say, “Hey, you should invest in a rental property in Phoenix even if you weren’t planning on it.” Maybe next autumn I would make that recommendation if the data looks good but it’s more likely it would be years from now.

But don’t forget that there are many people who have already decided to move to Phoenix and they would like an educated guess on likely pricing trends during the next several months.

Phoenix will fall ANOTHER 20% to 40%. The burst is just getting started there, and the downfall will be ugly to wash away the excess of ’04 and ’05.

That just ain’t gonna happen. The median home price in Greater Phoenix has only fallen 3.7%. The high was $267,000 in June 2006 and October was $257,000. Source

Obviously, it can’t fall “ANOTHER 20% to 40%” when it’s only fallen 3.7%.

Now, that doesn’t mean that the price hasn’t declined 20% in some outlying areas that are competing big time with homebuilders.

But overall, the median price for Great Phoenix has only gone down 3.7%… so far.

With the inventory flattening out, that will remove one factor putting pressure on prices. It’s not only the level of inventory that puts downward pressure on prices but the increase in the inventory.

Sure, there are significant downside price risks for the Arizona residential resale home market if the economy tanks.

But right now the outlook for 2007 is good. Gas prices down, interest rates likely stable or declining a bit, the stock market is up and it’s often a leading indicator for the economy.

It was a classic Ponzi Scheme, period.

That’s just silly.

Sure, some investors made ungodly amounts of money during the skyrocketing prices, but you lose that envy and jealously when you talk to investors who didn’t get out in time and their personal real estate bubble is bursting big time.

They didn’t Ponzi themselves. It’s not a Ponzi scheme.

Speculative real estate investing just has some huge risks.