The point of the article was to show an objective method of determining the fundamental value of real estate. Using mathematical modeling we can determine the extent of overvaluation. Then we can challenge the assumtions used in the mathematical model. When people randomly pick numbers out of the air to say what they think the impact will be is pretty much meaningless. At this point in the hype it's the people not willing to do math having their opinions publicized all over the palce.
Just like my analysis of LEND, when I do the same for real estate in my local market, there is some fat but not much. and certainly not 50%. Perhaps 50% applies to your local market, but I doubt nationally we will see a drop over 5% to 10% in year over year numbers.
Quote:
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As part of its quarterly survey, the National Association of Realtors reported a 2.7 percent decline in prices in the fourth quarter compared to the fourth quarter of a year earlier. That's the biggest year-over-year drop on record.
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http://money.cnn.com/2007/02/15/real...s_q4/index.htm