Craigslist Signals Housing Woes

There is an unscientific way to measure when a boom turns into a bust: go the on-line chat rooms.

There are numerous stock market chat rooms, where investors can go and share information about a stock (or, more likely, simply gossip about it and act like they know something about the company - when they do not.) You can find these on Yahoo Finance (the message boards) and Siliconinvestor.com.

During the dot-com boom, there were thousands of posters on the various chat rooms, gleefully watching their companies shooting to the moon. Some were even posting fake information, on the hope that they could “pump” and then “dump” the stock for profit. Several went to jail or were fined.

And then, stocks did an awful thing: they went down. And chat rooms were no longer cool.

A declining market just isn’t that much fun to talk about, apparently.

People abandoned the chat rooms. They didn’t go away completely but the number of posters on them dwindled significantly.

And now you can see the same thing occuring with the housing boom. During the boom, chatrooms were plentiful, from the Wall Street Journal’s housing forum to the infamous Craigslist forum.

I have read the Craigslist housing forum for at about four years now. I admit it. In 2005, some of the chains of messages would go for over a page. Look at it now. Very few people are posting. The San Francisco board used to be the most active, but it pales in comparison to its former self.

It means only one thing: the game is over. What is there to debate now that housing is actually slowing and/or going down? In the past, there used to be rousing debates about the benefits of renting, with renters being called losers in life (and other things much worse.) The housing bubble was debated, with both sides making their arguments.

Now, there isn’t much of a debate- about anything. I haven’t seen a renter called a loser in quite a few months. Come to think of it, I haven’t heard the infamous phrase, “if you don’t buy now, you’ll be priced out” for awhile either.

Hm…interesting.

I told you it was unscientific but when the crazies stop wasting their time posting on the chat rooms, you know the jig is up.

On the housing forum chat rooms, Elvis has clearly left the building.