The housing market has had four significant downturns in the last 20 years. The current downturn has been swifter than any of the prior four. The extent of this correction has been similar to the two "soft landings," but we don't seem to have landed yet. 1988-91: The 1988-1991 period was a hard landing, with many companies going out of business. The reasons for the severity were primarily: 1) Job losses, particularly in California and Florida; 2) government-induced wipeout of the savings and loan industry, which was providing most of the capital to builders; and 3) some speculative price appreciation that caused affordability problems. The job losses also led to horrendous consumer confidence. 1993-1995 and 1998-2001: The two soft landings in this cycle were primarily driven by risin...
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