BluefoxToday blog : Housing Isn’t Entering a Double-Dip; It’s Merely Continuing its Journey

Housing Isn’t Entering a Double-Dip; It’s Merely Continuing its Journey

While some point to the possibility that home prices and sales may once more turn down, the reality is that housing isn’t entering a double-dip; it’s merely continuing its journey. Homeowners or potential home buyers want to know what’s really happening; but the news is so confusing that it’s virtually impossible to tell. For many the confusion arises from the surge in sales and prices that began last fall and continued into the spring, a time when economists and pundits were quick to call the housing bottom.


Jim Cramer even set the specific date for the bottom, June 30, 2009, telling consumers to go out and buy.

Alan Greenspan agreed and said housing would bottom by the middle of 2009.

Housing Predictor said that most of the market would see bottom between April and June of 2009.

Moody’s put the date a bit further out, guessing Q-3.

Money Magazine said to wait until the end of that year.

● Late in 2009, the NY Daily News gushed with optimism, “Home prices are nearing the end of a three-year slump and should rise in 2010.” They based their prediction on the polling of forty-one economists, with all but one agreeing that a bottom had been reached or would be reached within a year.


Many of the positive predictions came about as a result of the Housing Tax Credit, which, in some areas created a buying frenzy with happy sellers raising prices to compensate for the government’s gift.


More recently however, negative voices have been predicting a “double dip” for the housing market. It’s no wonder that buyers are sitting on the sidelines or that sellers are either elated because “home prices are rising,” or depressed because of the coming “double dip. On Wednesday, an article on HousingWire stated, “Housing’s double dip is here.


However, I don’t believe we’re entering a “double dip,” for housing never truly reached a bottom. The anticipated stabilization that was to be created by the multitude of recent government programs never materialized. The additional sales and price increases that resulted from the Tax Credit was artificial and failed to provide the predicted results, doing nothing more than shuffling the year’s sales numbers, while costing taxpayers billions. There was no wave of “new” buyers, for only a miniscule number of permanent renters were enticed to become homeowners. No, we need not fear a double-dip; the housing crisis that began in most areas in 2007 is still going strong, and a comparison of the annual sales numbers will quickly point that out.


Certainly we can find comfort if “our” area is doing okay, but the bulk of the country is far from okay. However, buyers and sellers shouldn’t be fearful of this news of a “double dip,” as if there is some new villainy set to prey on housing. The market is merely continuing the process of being re-defined, a process that includes lots of ups and downs. And while no one can be certain of the ultimate outcome, those who pounce on this latest prediction de jour will remain as confused as ever.

The Housing Guru: The expert source for all your housing questions




Comment balloon 49 commentsJohn Mulkey • August 26 2010 07:02AM


I like your point and I agree with you.  I do think that we are just continuing our journey.  If there was an upswing it was manipulated by the tax credit. 

Posted by Debbie Atwood, Real Estate Broker (Century 21 Real Estate Center Everett, WA) about 10 years ago

Those of us who have been wrong appear to have had illustrious company.


This recession will not end until we take steps to fix the basic problems of our economy:

To much public debt to be sustained.

Too much government leading to that debt.

Too much private debt.

Too little personal saving leading to that debt.

Too great of a trade imbalance.

Too many people telling their children they are too good to work in the factories that made America - leading to that trade imbalance.

Too high a standard of living for the slow growth in our GDP/productivity.

Too little appreciation of how indebted we are to China.

Too few people having babies.

Too many people disliking the new immigrants that do.

Too much control of our nation by the spoiled Boomer generation.





Posted by Jim Hale, Eugene Oregon's Best Home Search Website (ACTIONAGENTS.NET) about 10 years ago

Debbie - Exactly.

Jim - Great points.


Posted by John Mulkey, Housing Guru ( about 10 years ago

I agree with you. We artificially moved the tax credit into the picture. Buyers are coming down harder these days and they are winning those negotiations too!

Posted by Loreena and Michael Yeo, Real Estate Agents (3:16 team REALTY ~ Locally-owned Prosper TX Real Estate Co.) about 10 years ago

Loreena, That's right buyers are very savvy and have done their homework; they don't care what the homeowner owes on their mortgage....


Jim, add this to your list
Too much bad leadership in Washington!

Posted by Monica Nunchuck, St. Augustine Buyer's Agent (Florida Homes Realty & Mtg) about 10 years ago

Loreena - We just have to adjust to the realities of today.

Monica - I agree on the leadership problem, and that's been a problem for decades.

Posted by John Mulkey, Housing Guru ( about 10 years ago

Yes you are correct. If it was for the tax credit we would not have the up swing. 

Posted by Keith Lawrence, ABR, SFR (Christie's International) about 10 years ago

Keith - An in reality, the downside we're seeing is just a continuation of what began 3 years ago.

Posted by John Mulkey, Housing Guru ( about 10 years ago

There are certain stores I shop in, if I find something NOT on sale, I go back a week later and it is. We conditioned the buyers on the tax credits and IMO they are waiting. I don't know that we ever stabilized we just had a boost during the tax credit days.

The Administration needs to leave the market alone, it will correct. Government interference is delaying the recovery.

Posted by Missy Caulk, Savvy Realtor - Ann Arbor Real Estate (Missy Caulk TEAM) about 10 years ago

John, I agree it is more of a correction than a double dip. Consumer confidence and more jobs will bring the market back.

Posted by Michael Setunsky, Your Commercial Real Estate Link to Northern VA about 10 years ago

Missy - Correction is painful.  We'll not recover until we have that pain.

Michael - And that may take some time.

Posted by John Mulkey, Housing Guru ( about 10 years ago

Jim #2 - ditto.  The best we can do is work (vote!) to de-centralize government so that it will once again be accountable to the people and stop interfering in the free market.

Posted by John Souerbry, Homes, Land & Investments (Cordon Real Estate) about 10 years ago

The market is doing what the market does.  It goes up for a while and it goes down for a while.  It travels in huge waves.  In the late '80s and early '90s it was in the tank for probably 6 or 8 years as it slowly climbed back up to the ripping and roaring late '90s to mid 2000's and now all the politicians have screwed it up again. 

Will it come back?  Surely!  Will it take a while?  Most likely!  Hang on, it's a wild ride but..... that's what makes life and our job interesting.  If it was easy everyone would be in our business.

Posted by Ralph Janisch ABR CRS Broker, Selling Northwest Houston to good people like you! (Janisch & Co.) about 10 years ago

John - The market must determine its own bottom.

Jeanne & Ralph - It will definitely be an interesting ride.

Posted by John Mulkey, Housing Guru ( about 10 years ago

Thanks for the informative content !

Posted by Nancy Keith (Keller Williams Realty) about 10 years ago


Excellent assessment. The continued decline in housing was inevitable...just somewhat delayed by the government's actions.


Posted by Richard Iarossi, Crofton MD Real Estate, Annapolis MD Real Estate (Coldwell Banker Residential Brokerage) about 10 years ago

Lenn reblogged this post, John, which is how I found it. I’m glad she did because it’s a great article.

What’s infuriating to me is that this failed attempt to “jump start” the housing market is expected to cost tax payers $10.8 billion. Such a waste.

Posted by Bill Burchard, Broker, Realtor, Representing Buyers and Sellers (3B Realty: 951-347-3818, CA) about 10 years ago

Nancy - Thanks for stopping by.

Richard - Yes, a delay and nothing more.

Bill - A waste that provided no permanent help.

Posted by John Mulkey, Housing Guru ( about 10 years ago

John....I am going to go out on a limb and say that we are almost at the tale end of this.....the investors aren't spending, but their money is screaming at them to be INVESTED. Consumers love to spend money and are just looking for a reason to do so. For the last several years, we have given nothing but reasons NOT TO DO SO. Banks have money to loan and are poised for new business. Employers want to jump start their business plans, and hire people so that they can grow and perform. My tally....... as soon as the Nations confidence level jumps up a few notches, we may get a nice....JUMP START. Our roles as agents are to be ready.........

Thank you John for a most enjoyable read and of course allowing me to comment.....

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) about 10 years ago

Interesting that all the 'experts' were so wrong.  "irrational exuberance" is what got us into this mess to quote Greenspan and its what has apparently kept us in it.  Experts are always overly optimistic because no one wants to hear the doom and gloom predictions that would be more accurate of the pace of the current market.

Posted by Steve Roake, Get Moving With Steve (The Freedom Group - Keller Williams Realty Infinity) about 10 years ago

Richie - While I'd love to share your optimism, the conditions I see won't allow it.  Consumers are broke; they overspent--many with their home ATM--and are in survival mode.  Many banks would be insolvent if they were forced to accurately value their loan portfolios; they're not lending out of fear that they'll soon need that cash to cover their losses.  But, we'll hope that your vision is clearer than mine.

Steve - I agree.

Posted by John Mulkey, Housing Guru ( about 10 years ago

John... spot on, I follow the ISM Index. That gives me a 2-3 mo. look forward for the job market.Real simple to understand & follow. Repeat after me; Leadership,Leadership, Leadership!!

Posted by Mike Morrison (Will & Will Real Estate Brokers, The Woodlands, Texas) about 10 years ago

I like your "journey" choice of words. I will incorporate that in my verbiage.

Posted by Cheryl Ritchie, Southern Maryland 301-980-7566 (RE/MAX Leading Edge about 10 years ago

Mike - And "leadership" seems to be in short supply.

Cheryl - The question is: When and where will this "journey" end.

Posted by John Mulkey, Housing Guru ( about 10 years ago

HA!  Is this a journey with a guide?  Or, is it a forced march with a drill sargent?

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley,, MD & VA Homes and Real Estate) about 10 years ago

Lenn - Great question. Thus far, it's a forced march; but at some point we'll be left to wander in the wilderness.

Posted by John Mulkey, Housing Guru ( about 10 years ago

There is so much information 'out there' because of the short and focused news cycle we face today, that it seems to be impossible to find a credible forecast nowadays.  That coupled with the obvious political implications of any such forecast (gloom and doom vs. slow recovery) just makes me cringe, but that is our reality today.  Best approach is to keep focusing on clients and their needs out there who are wanting to sell and buy and stop trying to decipher what's a-coming.

Posted by Manuel Monserrate about 10 years ago

Hi John.  I agree wholeheartedly...

We may have had a temporary blip up in volume and a flattening of prices...

But we aren't yet where we are going...

Thanks for writing,


Posted by Ken Tracy, Helping clients buy and sell since 2005 (Coldwell Banker Residential) about 10 years ago

Manuel - Best approach is to keep focusing on clients and their needs  Good advice.

Ken - And I do wonder where we are going.

Posted by John Mulkey, Housing Guru ( about 10 years ago


It's going to be interesting when the commercial side in trouble goes into foreclosure. We haven't seen the bottom yet.

Posted by Terry Chenier (Homelife Glenayre Realty) about 10 years ago

I agree.  There was no recovery here in North Georgia.  I sincerely hope that this is the bottom, though!

Posted by Jennifer Pirkle, Dahlonega, Dawsonville, Cumming, GA (Harvest Realty 678-617-0715) about 10 years ago

Terry - We haven't seen it, but surely it's there . . . somewhere.

Jennifer - I think we're still in decline.  As the reality of inventory levels begins to impact the market, we'll see prices dropping.

Posted by John Mulkey, Housing Guru ( about 10 years ago

John: I like your take on this. Thank you. Either way, the journey will be long and arduous for a while. Thanks again for the post. I personally don't look for a housing recovery for at least the next couple of years. Take care.

Posted by Paul McFadden, Pest Control, Seattle, WA. (Paratex) about 10 years ago


Great points made here. I think when economists start becoming cheerleaders, it becomes very difficult to take them seriously. I think I'll blog about it now.

Posted by Aaron Vaughn, REALTOR© 512-845-4204, My knowledge is your power | eXp Realty (eXp Realty) about 10 years ago

Paul - I just report what I see.  Now that I'm no longer involved in the home building industry, I have more time for research.  It appears that the future of housing will look significantly different for some time.

Aaron - All I want is the truth; give me the facts, and I'll determine where I should go from here.

Posted by John Mulkey, Housing Guru ( about 10 years ago

I think it is simple supply and demand. You must look at pricepoints and locales. We will see first timers be a LARGE part of this market UNTIL the job market grows.

The low end is very active (slightly less than during the tax credit). The higher end (for most areas that's $ 500K and up) will be tough for some time. People forget the last 10 years the lending world created products for people to buy homes they couldn't afford. Sure the sub-prime stuff blew up, but the real killer is the death of the Stated Income loan for Self-employed. Many psedo wealthy used these loans (some properly and some not so much) to progress their business, purchase 2nd homes, or investment property.

Folks- these people are the JOB creators and they can't get SBA loans, Helocs, or even refi any of their properties.

Stay tuned!

Posted by Mark Smith (Cherry Creek Properties, LLC) about 10 years ago

THANK YOU!! When I first had the "Double Dip" explained to me, that was my first question -- "how can this be a double dip if it's just a continuous downward trend??" My mentor was as flummoxed as me. I'm glad I know about the "Double Dip" concept's got nothing to do with what we're all living through (and working through) in 2010!!

Posted by Mindy Sylvester, Naples Fl Real Estate (MVP Realty) about 10 years ago

Mark - It is a mess, and I don't see a cure on the horizon.

Corinne - Housing, as a part of the economy in general, is undergoing structural changes; but those who don't just sit and wait for the return of the "old" market can do quite well.

Mindy - Exactly!

Posted by John Mulkey, Housing Guru ( about 10 years ago

And if "wishing made it so" those predictions would have been right. 

They are not.

Posted by Carla Muss-Jacobs, RETIRED (RETIRED / State License is Inactive) about 10 years ago

Carla - Perhaps we should be "hoping" instead of wishing.  That works sometimes.

Posted by John Mulkey, Housing Guru ( about 10 years ago

I'm sorry John.  You have this all wrong.  This is the summer of recovery. 

I will revisit your blog to see if you have made the correction or see if my correction has been deleted.




Posted by Jay Markanich, Home Inspector - servicing all Northern Virginia (Jay Markanich Real Estate Inspections, LLC) about 10 years ago

Jay - As usual, you're right, but I'm out of Wite-Out, so I can't make a correction.  Thanks for pointing me to the straight an narrow.  This is the summer of recovery. This is the summer of recovery. This is  . . .

Posted by John Mulkey, Housing Guru ( about 10 years ago

It might be a double dip, but the rise in the middle is less real than a Hooter's waitress (I had to tone that down a little...)

Posted by Lane Bailey, Realtor & Car Guy (Century 21 Results Realty) about 10 years ago

Lane - And like your analogy, the rise was artificial.

Posted by John Mulkey, Housing Guru ( about 10 years ago

John,  What is your take on how the leaking commercial bubble will impact residential lending?  I don't see any significant up tick in the housing market with banks taking back BIG commercial paper...

Posted by Jenna Dixon, 55 & Over | New Constructions | Horse Farms (Momentum Real Estate Group LLC) about 10 years ago

John - it's been an interesting few years and will continue to be interesting for the next few.  I agree this is still basically a correction and the slight rise was artificial.  We are still doing good in the Sacramento area overall right now however are inventory is increasing.

Posted by Lori Mode, Real Estate Made Simple (The Mode Real Estate Group) about 10 years ago

Jenna - I don't think it will have a dramatic impact, and will probably vary by area.  Banks are doing everything possible to avoid a collapse of CRE.

Lori - And we're preparing to enter the "slow" period in sales.

Posted by John Mulkey, Housing Guru ( about 10 years ago


That's a fair argument and the real estate events over the past year or two support your blog. Many areas of the country certainly aren't making any progress at all, despite the government help and truly enticing mortgage rates.

Posted by Esko Kiuru about 10 years ago

Esko - And once we can all acknowledge the reality of where we are, we can develop a new course.

Posted by John Mulkey, Housing Guru ( about 10 years ago