June 25, 2024 | Did Real Estate Peak with the ECM in May 2024?

COMMENT: Marty, you are by far the greatest long-term forecaster ever. I worked on the floor in 2007 when the market crashed on the exact day of your ECM. Everyone called it Armstrong’s Revenge. That was the very day of the high in the Shiller Real Estate Index for 2007. I know you say the short term is noise, and you are not known for short-term day-to-day forecasts, which you avoid. I put my house up for sale and just sold it based on your May 3rd post where you said, “Home prices in the US are near all-time highs. ” The realtor told me that sales have started to decline, and I sold the high.

Amazing.

Thank you

Mike

REPLY: There is always a time to buy and a time to sell. The short-term is just noise. If the Dow or Gold rallies for two weeks and then declines, that does not alter the long-term course until we have reached a turning point. But people want to see you as a forecaster daily, which is nonsense. The more someone trades, the lower their performance, and the risks increase exponentially.  I have done the long-term because we were the largest institutional adviser. They are not day traders.

Yes, the 2007 high on the Shiller Index was the precise day of the Economic Confidence Model. So far, all the indicators have confirmed that we should have a recessionary trend into 2028 with this turn in the model on this wave. With the prospect of war on the horizon, people will contract in their spending because of uncertainty.

We have gone through a period of a boom, but with war on the horizon, people will pull back on their spending, and we will generally enter a recession from May 2024 into August 2028. The shift from the Blue to the Red states is still occurring. So, real estate in the blue states will fall in price rapidly. The decline will vary from place to place.

Now we should enter a BUYER’S market whereas from 2020-2024 was a SELLER’S Market.

Martin Armstrong June 25th, 2024

Posted In: Armstrong Economics

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