Housing Bubble Bursting

VoidStarNull

Gurgle wrote:

Explanation for what?

A bubble bursts when people offload holdings because they realise they are worthless and not going to gain any value. Ever.

Example - dotcom bubble

As for a bursting bubble - if it started to burst last year, then its gone now. A bubble doesn't take years to burst.

Here's a table of house price "crashes" from other countries, excerpted from
Morgan Kelly's paper (the paper which started this thread):

Peak Year % Fall Previous rise Duration of fall
Netherlands 1978 -50 98 7
Finland 1989 -48 109 6
Switzerland 1989 -39 70 10
Norway 1987 -39 53 6
Denmark 1978 -36 22 4
New Zealand 1975 -35 57 5
Sweden 1979 -35 26 6
Spain 1977 -33 24 4
Denmark 1986 -32 52 6
Japan 1974 -31 56 4
Italy 1982 -30 84 4
Finland 1974 -30 22 5
Japan 1991 -27 78 10
Sweden 1990 -27 38 6
Italy 1992 -26 65 6
Switzerland 1973 -26 34 4
Ireland 1981 -22 53 5
Canada 1981 -20 6 4
Table 1: Magnitude and duration of falls in real house prices

Sorry for the horrible formatting

As Kelly mentions in his paper, housing "crashes" never happen quickly, because
of reluctance of sellers to take a loss. So why do stock market crashes happen
quickly? Because stocks can be sold short. This allows people who don't own
a stock to profit in a falling market by "selling" it at a low price, and forces
the price to fall quickly.

Now, if someone could invent a way of short-selling houses, they could make
a lot of money in Ireland today...

VoidStarNull

SimpleSam06 wrote:

Well either that or we'll devolve into some sort of a mad max scenario. I've dibs on Pa's ghandi suit for ruling the highways in!

Great suit, are you planning to rule by passive peaceful protesting?
Crazed ex sub-urbanites will drive their 4x4s right over you

daveirl

This post has been deleted.

SimpleSam06

Gurgle wrote:

Explanation for what?
You want mathematical theory?

Basic system dynamics show that any underdamped system overshoots its steady-state value, oscillates a bit and then levels off. The rate of rise in the last 10 years is a classic underdamped system.

Well when the housing market miraculously transforms itself into a machine component, I'm sure all and sundry will hail your wisdom.

Either you
a) don't want to know, none are so blind and all that
b) are being paid to hold the line regardless
c) are taking the mickey, aka trolling
d) are cleverly playing devil's advocate and honing the debating skills of the bears in order to prepare for an inevitable VI onslaught
or e) are for some reason incapable of grasping all of the many many excellent arguments put forward in the last two pages why you are wrong

VoidStarNull wrote:

Great suit, are you planning to rule by passive peaceful protesting?

Oh hell no, I'm a classicist. The suit is just to put people off. They'll be all like, "oh hey, theres the father of modern peaceful protest, isn't that cute", and next thing they'll be handcuffed to the radiator with a hacksaw in easy reach and a dripping fuel tank. Where are your vested interests now, barharhar!?!

SkepticOne

Gurgle wrote:

As for the soft landing - My understanding of this term is that there will be no catestrophic decrease in prices. The prices peak, drop a bit and level off.

I asked this earlier. How much is a bit? How much do they need to drop before we no longer call it a soft landing?

The_Conductor

SkepticOne wrote:

I asked this earlier. How much is a bit? How much do they need to drop before we no longer call it a soft landing?

Its entirely subjective. A soft landing for me might be catastrophic for you, and vice versa. I bought my townhouse in Lucan village in 2001. A softlanding for me would be a return to 2001 values (which were overpriced even then.....). Most of the rest of the country would be in tears if they went back to 2001 levels.

From my own, very subjective perspective- I would consider a gentle collapse in property prices by about 50% over a 2-3 year period to be a "soft landing". If prices fell more than 50% I'd be getting a bit worried though.

Shane

gurramok

So Ireland when compared to Professor Morgan Kelly table of booms and busts..
1996 when it all started, duration 11 years so far (http://www.finfacts.com/irelandbusinessnews/publish/article_10006275.shtml)

Price rise 270%

The highest rise previously in boom/bust cycle was 109% in Finland, bejayzus, it really is the worst and longest cycle ever recorded worldwide.

whizzbang

gurramok wrote:

So Ireland when compared to Professor Morgan Kelly table of booms and busts..
1996 when it all started, duration 11 years so far (http://www.finfacts.com/irelandbusinessnews/publish/article_10006275.shtml)

Price rise 270%

The highest rise previously in boom/bust cycle was 109% in Finland, bejayzus, it really is the worst and longest cycle ever recorded worldwide.

absolutely!

I'm surprised economists are not flooding here to watch it all unfold first hand. I can imagine a bubble of this size would be fascinating to the world of Economics.

There will be many books and papers written on when happened here I reckon.

davej

It seems to me that both Bulls and Bears need to get their definitions straight.

So far there seems to have been some reduction in house prices in line with interest rate increases (and to a smaller degree due to the stamp duty effect). Can we really say that a crash is happening right now?

Surely a "crash" or "burst" bubble cannot be defined as 6-7 years of stagflation ? In my mind these metaphors suggest a sudden sharp shock to the market, for example a 20% drop over 3 or 4 months. It just seems that the bubble/crash analogy isn't very applicable to property.

Anyway here's more commentary from Dermot O'Leary of Goodbody

http://www.independent.ie/business/irish/property-not-a-good-home-for-investors-691334.html

davej

chump

It's funny reading this thread, particularly the last post by Gurgle - that is some fantastically logic seemingly based on a simple physical/engineering theory. Jaysus hands up when you don't know what you're talking about. Don't attempt to fit a square peg into a circular slot.

Anyway, reading my bloomberg this morning...

By Anchalee Worrachate and David McIntyre

June 5 (Bloomberg) -- The euro strengthened to a record against the yen and advanced versus the dollar on expectations the European Central Bank will raise interest rates tomorrow and signal further increases this year.

The euro has gained for four straight days against the yen as the extra yield investors earn on European two-year debt over similar maturity Japanese bonds widened to near a five-year high. The yen is the world's worst performing currency against the dollar so far this quarter, declining 3.2 percent, as Japanese investors seek higher-yielding assets overseas.

``It's not just an ECB story that's driving euro-yen higher, it's Japanese investors investing abroad,'' said Adam Myers, currency strategist at UBS AG in London. ``They're putting significant amounts of their own capital offshore to generate a higher yield.''

The European currency rose to an all-time high of 164.61 yen and was at 164.42 as of 7:18 a.m. in New York, from 164.27 late yesterday. It was at $1.3516 to the dollar from $1.3489. The dollar bought 121.63 yen, from 121.77. The euro may rise to as high as $1.40 by the end of the year, Myers said.

The yen has declined 4.3 percent against the euro this quarter as the Bank of Japan held borrowing costs at 0.5 percent. The rate compares with the ECB's benchmark of 3.75 percent and 5.25 percent in the U.S.

ECB Forecast

The ECB will raise rates tomorrow to 4 percent, according to all 52 economists surveyed by Bloomberg News. European 2-year government bonds yielded 3.43 percentage points more than equivalent Japanese notes, the most in five years.

Bank of America raised today its forecast for European interest rates, saying the ECB would raise them to 4.75 percent by mid-2008. It previously predicted they would peak at 4.5 percent.

The euro extended gains as the International Monetary Fund said in an annual report the euro-region economy will grow ``about'' 2.5 percent in 2007, faster than the 2.3 percent it predicted April 11. Europe grew at three times the pace of the U.S. in the first quarter.

Standard & Poor's said in a separate report today that the creditworthiness of Germany and France, the euro-area's largest economies, has improved.

``Government debt levels are now on a clear downward trend,'' S&P credit analyst Kai Stukenbrock said in the report.

Japan's currency dropped to the lowest in more than 15 years against the Australian and New Zealand dollars, which have benefited from higher interest rates.

NZ Dollar Rallies

Against the Australian dollar, the yen fell to 102, the lowest since April 1992. It declined to a 17-year low of 91.67 against the New Zealand dollar. Interest rates in both countries are at least 5.75 percentage points higher than those in Japan.

New Zealand's currency rallied to 75.36 U.S. cents, the highest since it was floated in March 1985.

The Australian and Canadian dollars also rose after prices of metals they export increased. The Canadian dollar, the top performing Group of Seven currency this year, extended gains against its U.S. counterpart to C$1.0574, near a 30-year high.

The yen fell to the lowest against the South Korean won since October 1997, reaching 7.6189. South Korea's economy is showing signs of revival, which is helping to boost stocks.

The dollar may be supported by speculation Federal Reserve Chairman Ben S. Bernanke will signal today that the economy is resilient and inflation isn't yet tamed, adding to expectations the Fed doesn't need to lower interest rates.

Bankers' Conference

He will discuss housing and the economy via satellite at 2:15 p.m. in Cape Town, South Africa, as part of a business conference. Bank of Japan Governor Toshihiko Fukui and ECB President Jean-Claude Trichet will also speak.

``He may say economic growth is picking up and express concern over inflation,'' said Akifumi Uchida, deputy general manager of the marketing unit at Sumitomo Trust & Banking Co. in Tokyo. ``This would be supportive of the dollar,'' which may rise to 122 yen and $1.3450 per euro today, he said.

Traders reduced bets of a Fed rate cut by the end of 2007 to 18 percent from 98 percent at the start of May.

The dollar may also benefit from a drop in yen options volatility to the lowest in almost 11 years. The decline may encourage investors to borrow yen to buy securities denominated in higher-yielding currencies such as the dollar and euro.

Volatility Drops

Volatility implied by one-month dollar-yen options dropped to 5.85 percent, the lowest since Bloomberg started tracking the data in 1995. Traders quote implied volatility, a measure of expected exchange-rate swings, as part of setting options prices.

The euro may advance to 169 yen, said Masashi Hashimoto, a currency analyst at Bank of Tokyo-Mitsubishi UFJ Ltd. in Tokyo.

``It may target previous highs set in 1992,'' he said.

A resistance level of 167.97 is the euro's theoretical previous high set on Sept. 15, 1992, before the single currency was created in 1999. It is calculated from the spot rates of the individual currencies that combined to form the euro. One euro was equivalent to 1.95583 German marks. Resistance is a level where sellers may outnumber buyers.

Securities firms, asset management companies and banks will market more than 2.4 trillion yen ($19.7 billion) of investment trusts to attract Japanese investors to foreign securities in June, according to data compiled by Bloomberg News.

To contact the reporter on this story: Anchalee Worrachate in London at aworrachate@bloomberg.net ; David McIntyre in Sydney at dmcintyre2@bloomberg.net ;

chump

If rates do rise to 4.75% BASE by this time next year - nobody can estimate what trouble we'll really be in.

The government of course may bail us out, to a degree, by offering increased mortgage interest relief, but it will cripple the finances of the country in a time when the exchequer returns will already be substantially weakened by reduced home construction and our reduced economic health.

whizzbang

davej wrote:

It seems to me that both Bulls and Bears need to get their definitions straight.

So far there seems to have been some reduction in house prices in line with interest rate increases (and to a smaller degree due to the stamp duty effect). Can we really say that a crash is happening right now?

Surely a "crash" or "burst" bubble cannot be defined as 6-7 years of stagflation ? In my mind these metaphors suggest a sudden sharp shock to the market, for example a 20% drop over 3 or 4 months. It just seems that the bubble/crash analogy isn't very applicable to property.

Anyway here's more commentary from Dermot O'Leary of Goodbody

http://www.independent.ie/business/irish/property-not-a-good-home-for-investors-691334.html

davej

perhaps the wording is wrong, but a lot of people feel what happened in the UK between 1989 and 1995 could be described as a "property crash"

http://en.wikipedia.org/wiki/Image:Graph-house-prices-1975-2006.gif

I believe we are looking at a similar reduction over a similar time to what they saw. I'd call it a crash, what would other people call it?

Its not a 20% in 4 months crash like a stock market, property markets take much longer to unwind. But it will be a real numeric reduction, not just "rising behind inflation"

VoidStarNull

davej wrote:

It seems to me that both Bulls and Bears need to get their definitions straight.

So far there seems to have been some reduction in house prices in line with interest rate increases (and to a smaller degree due to the stamp duty effect). Can we really say that a crash is happening right now?

Surely a "crash" or "burst" bubble cannot be defined as 6-7 years of stagflation ? In my mind these metaphors suggest a sudden sharp shock to the market, for example a 20% drop over 3 or 4 months. It just seems that the bubble/crash analogy isn't very applicable to property.

Anyway here's more commentary from Dermot O'Leary of Goodbody

http://www.independent.ie/business/irish/property-not-a-good-home-for-investors-691334.html

davej

See this article for a discussion of the difference between a bursting housing
bubble and a bursting stock market bubble:

http://www.itulip.com/housingnotlikeequities.htm

Basically, housing busts are characterized by the market seizing up - transactions
disappear. Prices fall only slowly and over a long period of time.

By this definition, Ireland is clearly and unequivocally experiencing a housing
bust right now.

SkepticOne

I think I understand "soft landing" now.

A "soft landing" is simply what a crash is called while the crash is actually happening.

Would that be correct, Gurgle?

VoidStarNull

Looks like the number of houses for sale in Dublin over on daft is
starting to level off (daftwatch.atspace.com).

Either more people are buying (hurray stamp duty reform!) or
fewer houses are being put up for sale...

Or maybe it's just a blip...

daveirl

This post has been deleted.

VoidStarNull

It could be a confirmation of pjbrady's theory of a post-election jump in sales,
based on the "now-or-never" principle. Seems to be affecting Dublin only tho'.

Zambia

I would expect to see some rise in sales as there is nothing left to wait for.

Plus Gurgle is correct people do need to buy houses...

However we are still at a huge inventory from this time last year in fact over way over 100 % approx more houses than that time last year.

Even if Daft watch levels of i see no guarantee of a stabling of Prices. As has been stated oversupply leads to price drops.

Oh and for Bubbles bursting its not like you wake up in the morning and see your 500,000 house devalued by 150,000 in a few days it does take time.

The Irish property market has been hit and its down and the ECB is stepping up to kick it while its down.

Raskolnikov

That Blomberg article would scare the pants off anyone :eek:

Last year, we had interest rates of 2%, currently we have rates of 3.75% and next year, we're projected to have rates of 4.75%. The average FTB'er is on a variable mortgage rate that's typical 1% over the base rate.

For fits and giggles, let's assume that we have a first time buyer, with 35 year, 100% mortgage of €350,000. If they started off a mortgage at the ultra low rate of 3% (base rate + 1%), they would have had to pay €1,346 a month for their repayments.

Now, fast forward to next year where we'll have 5.75% (base + 1%) rates. This means that the repayments will shoot up to €1,937.

If I bought last year, I would be crapping myself.

Raskolnikov

Raskolnikov wrote:

That Blomberg article would scare the pants off anyone :eek:

Last year, we had interest rates of 2%, currently we have rates of 3.75% and next year, we're projected to have rates of 4.75%. The average FTB'er is on a variable mortgage rate that's typical 1% over the base rate.

For fits and giggles, let's assume that we have a first time buyer, with 35 year, 100% mortgage of €350,000. If they started off a mortgage at the ultra low rate of 3% (base rate + 1%), they would have had to pay €1,346 a month for their repayments.

Now, fast forward to next year where we'll have 5.75% (base + 1%) rates. This means that the repayments will shoot up to €1,937.

If I bought last year, I would be crapping myself.

How about those who bought in 2005
The figures for income and what kind of mortgage loans they got is all in this thread if you want to do the maths or just estimate:

http://thepropertypin.com/forum/viewtopic.php?t=2012

Including the loan terms etc

JupiterKid

The really scary prospect to me is going to be magnitude and the duration of the house price fall. If you look at Malcolm Kelly's charting of previous housing crashes, the 270% increase that the Irish housing market has experienced over 11 years is way, way ahead of all the others.

By that reasoning, we could be looking - potentially - at a 100% price drop or more lasting up to 10 to 15 years. That would be absolute disaster and perhaps in the coming decades Economics and Business Studies students the world over will be given the Ireland house price bubble disaster example to show them how extreme bubbles can get when all logic and sanity - both in terms of buying and advancing credit - goes out the window.

Pa ElGrande

JupiterKid wrote:

The really scary prospect to me is going to be magnitude and the duration of the house price fall. If you look at Malcolm Kelly's charting of previous housing crashes, the 270% increase that the Irish housing market has experienced over 11 years is way, way ahead of all the others.

By that reasoning, we could be looking - potentially - at a 100% price drop or more lasting up to 10 to 15 years. That would be absolute disaster and perhaps in the coming decades Economics and Business Studies students the world over will be given the Ireland house price bubble disaster example to show them how extreme bubbles can get when all logic and sanity - both in terms of buying and advancing credit - goes out the window.

100% drops not going to happen, property at the start of the boom was seriously underpriced after the effects of the 80's recession (i.e. mass emmigration, falling birth rate and very tight lending standards). Though some specuvestors will experience severe pain in areas where there is no local demand from first time buyers or other investors, since they will not be able to sell these properties (i.e. areas with no employment growth that also tend to be impacted more readily by outward migration when jobs are scarce)

We now have a situation where capital appreciation has stalled (and is going negative) and interest rates are rising, the number of FTB's is falling (outcome of the 80's birth rate fall, and being priced out of the market), unless serious investors are picking up property that gives rental yields above current interest rates then they are likely to disappear as well. The only thing that can keep the residential market afloat now is pent-up demand from FTB's, if unemployment levels start to shoot up to 8% then it really is game over, since young people will logically have most difficulty finding employment here.

Calina

JupiterKid wrote:

.......
By that reasoning, we could be looking - potentially - at a 100% price drop or more lasting up to 10 to 15 years. ....

A 100% price drop implies a fall to 0E. This is not going to happen. The extent of the drop is open to debate and will probably never really be known given the lack of transparency about sales prices in this country. That being said, some people are forecasting 70% falls. I don't know if this is possible. I think to have an idea of how much of a problem on the way down it is, you need to look at how much of a problem on the way up it was....as in those which shot up disproportionately fast are, imo, most likely to take a disproportionate hit. As this includes most of the des res addresses and not just parts of Leitrim and Roscommon, it is not a view which is universally shared. There is a view out there that some parts of the country are more protected because of high demand. I'm not sure it's quite that simple in the end.

Gurgle

chump wrote:

It's funny reading this thread, particularly the last post by Gurgle - that is some fantastically logic seemingly based on a simple physical/engineering theory. Jaysus hands up when you don't know what you're talking about.

System dynamics can only be called simple by someone who's never studied it
Wikipedia definition:
System dynamics is an approach to understanding the behaviour of complex systems over time. It deals with internal feedback loops and time delays that affect the behaviour of the entire system.

At least my theory is based on something scientific

And I've been pretty consistent in my predictions, even if we can't agree on what defines a bubble bursting Vs a crash Vs a soft landing.

From last july:

chump wrote:

Bubble will fizzle downwards within the next 9-12 months and then be at a stage of slight negative or 0 growth for the next 5+ years before eventually rising again at a similar rate to wage increases.

The fizzle over the next 9-12 months I believe will affect different areas differently and would amend Cantabs view as follows

^^ You were doing well up to here, but then it all falls apart:

PRICE DECREASES
25+% commuterland apartments 1.5+ hr dublin city commute and commuterland belt in other cities/town
15+% commuterland houses 1.5+ hr dublin city commute and commuterland belt in other cities/town
~10% apartments on DART/LUAS/within less than 1 hr drive from city
~5% houses on DART/LUAS/within less than 1 hr drive from city
0% embassy belt, established even number postcodes, top-drawer, and also south side enclaves on the northside

And I can't leave this out:

SkepticOne wrote:

A "soft landing" is simply what a crash is called while the crash is actually happening.

Would that be correct, Gurgle?

Please, explain where I'm going wrong here:

Growth: House prices rise at a higher rate than inflation
Soft Landing: House price growth slows or stops allowing the market to catch up (via inflation) over a period of several years.
Crash: House prices decrease significantly over a period of months to years
Bubble bursting: House prices decrease dramatically over a period of weeks to months.

SimpleSam06

Gurgle wrote:

System dynamics can only be called simple by someone who's never studied it
Wikipedia definition:
System dynamics is an approach to understanding the behaviour of complex systems over time. It deals with internal feedback loops and time delays that affect the behaviour of the entire system.

At least my theory is based on something scientific

No, you're blowing smoke in the hopes that no one else has studied it. Its like those creationists over in the US, abusing science for their own seedy ends. Even by your own definition given to us earlier, your "steady state" was ten years ago. Would you like to call a return to 1997 prices a soft landing? Why is anyone even feeding this troll?

SkepticOne

Gurgle wrote:

And I can't leave this out:

SkepticOne

A "soft landing" is simply what a crash is called while the crash is actually happening.

Would that be correct, Gurgle?

Please, explain where I'm going wrong here:

Growth: House prices rise at a higher rate than inflation
Soft Landing: House price growth slows or stops allowing the market to catch up (via inflation) over a period of several years.
Crash: House prices decrease significantly over a period of months to years
Bubble bursting: House prices decrease dramatically over a period of weeks to months.

My problem was that you defined it as slow falling of prices. My question then was how do you define slow falling in this context? The current 10% annualised falls we are seeing now? My problem is that "soft landing" is becoming a moving target. We are always on track for a soft landing because no one knows what the hell it means.

If however you define soft landing as somewhere between 0% and the rate of inflation (as you seem to be doing now) then it seems to me that we have already gone beyond that and are moving into actual falling prices.

If the current rate of falling continues for the next few years then we are looing looking at drops of 40 to 50%. Would this be a crash? I (and I think most people) would maintain it would be, yet I can imagine the whole thing being called a soft landing by those with a vested interest in the market.

tHE vAGGABOND

Good post Gurgle - in a thread with more and more insanity in it by the day

I agree with you 100%

chump

Gurgle wrote:

System dynamics can only be called simple by someone who's never studied it
Wikipedia definition:
System dynamics is an approach to understanding the behaviour of complex systems over time. It deals with internal feedback loops and time delays that affect the behaviour of the entire system.

At least my theory is based on something scientific

Well I've a degree in science so I know something about it (well I used to ) and I wouldn't dream of trying to make a physical theory match this scenario.

Gurgle wrote:

And I've been pretty consistent in my predictions, even if we can't agree on what defines a bubble bursting Vs a crash Vs a soft landing.

To be honest I'm not sure what your predictions are, but from what I remember you believe what we have now represents a soft landing - but how can this be so? We may have only just begun. There is no possible way anyone can call what we have yet - because we need to see what happens next. Maybe prices will take off again and history will regard this as a 'blip'.

Gurgle wrote:

From last july:

me wrote:

Bubble will fizzle downwards within the next 9-12 months and then be at a stage of slight negative or 0 growth for the next 5+ years before eventually rising again at a similar rate to wage increases.

The fizzle over the next 9-12 months I believe will affect different areas differently and would amend Cantabs view as follows

^^ You were doing well up to here, but then it all falls apart:

me wrote:

PRICE DECREASES
25+% commuterland apartments 1.5+ hr dublin city commute and commuterland belt in other cities/town
15+% commuterland houses 1.5+ hr dublin city commute and commuterland belt in other cities/town
~10% apartments on DART/LUAS/within less than 1 hr drive from city
~5% houses on DART/LUAS/within less than 1 hr drive from city
0% embassy belt, established even number postcodes, top-drawer, and also south side enclaves on the northside

Fair enough I made a guess, but so did many here. I certainly didn't expect to hit the nail on the head, but if I remember correctly we all said ah feckit we'll make a guess.
And anyway my guess isn't way off. Maybe things are happening more slowly than I would have anticipated but I honestly do still believe those kind of falls may well take place.

One thing is for sure you won't be able to dismiss my best guess or anyone else's here until the dust has settled - and then we'll see just how far off they were.

And just for clarity what is your best guess (for the history books )

chump

tHE vAGGABOND wrote:

Good post Gurgle - in a thread with more and more insanity in it by the day

I agree with you 100%

It's good to stick your head in and have a read but what's your argument for the insanity?

And what exactly do you agree with that Gurgle has posted? - he hasn't exactly had any groundbreaking posts.

Zambia

Gurgle wrote:

Growth: House prices rise at a higher rate than inflation
Soft Landing: House price growth slows or stops allowing the market to catch up (via inflation) over a period of several years.
Crash: House prices decrease significantly over a period of months to years
Bubble bursting: House prices decrease dramatically over a period of weeks to months.

Growth - I agree with
Soft landing - I would agree with that Definition too
Crash / Bubble Bursting - I think the words significantly and Dramatically leave to much wiggle room

A reduction in house prices of about 10% over 1 year would imo be drastic if you factor in inflation and higher interest rates.

Thats only a fall of 35 on a 350,000 house we have seen these drops already on this forum with people looking to sell and having trouble achiving buyers.

We are not furnished with the real figures on price drops as we only have asking prices to go by not actual prices that property goes for.