Bankruptcies of Major Homebuilders and Real Estate prices

Quote from Port1385:

Im surprised to see that none of the major homebuilders has filed for bankruptcy during this entire time despite incredible economic conditions. I have not gone through their earnings reports or listened to any conference calls, but just a quick browse of their financial sheets indicates massive losses and incredible debt.

I have always been taught that the bottom to any market usually starts with a few high-profile bankruptcies and single digit stock prices where fear is at an extreme high. This hasnt occurred amongst the builders.

TOL has been trading in a defined range since 2007 which might indicate a base, but price can easily fall out of that range like it did with Countrywide Financial.

I can only surmise that we are not quite yet at the bottom with either housing prices or home builders. When one of the majors finally goes Chapter 11 then I think such etfs as the XHB will become attractive and real estate prices will finally bottom.

However, it seems like the majors can take a beating for a while and so this will be a long, grinding process....
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No company is going to be allowed to go bankrupt if it can at all be helped (by the gov't) because that would trigger CDSs.
 
Quote from Eight:

The Japanese property bubble was bigger. At the top they had 150 year mortgages too. Five years of price declines in the US would not surprise me though.
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Yeah, hence 5 years vs 13. We did get to >5 times income, Liar/Ninja loans, and 125% mortgages though.
 
Quote from NazSpaz:

Yeah, for real. Only THIS GUY should post. Ever. Please everyone do us all a favor and send all posts and all threads to this guy first for his approval, he has done all the homework on every topic and only he will decide when you should discuss anything. I wouldn't even take a piss or feed your dog without checking with him if you know what's good for you.

Even though Port1385 makes a very good point, and might have created a valuable discussion on the topic which seems both timely and informative - how dare he put something on these boards without athlonmank8 first giving a seal of approval. Wow.
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No that's not even the case. I'm sick of reading his stupid posts. His opinion doesn't matter. I shorted housing several times (some profitable and some not) thinking they'd do the same......then I realized financially they're not in that bad of shape yet.

It's funny because TOL is probably the better out of the group too. That's the only one he mentions.
 
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