They really said it ! [1]

Some quotes are unforgettable.

In 2005, I remember reading this with complete shock. I know it's easy to say this now, but these types of claims are so shockingly anti-common sense that it's easy to call them BS on the spot.

Let me direct you straight to the paragraph (free registration required.)

I asked Toll what our children - my kids are both under 8, I told him - would be paying when they're ready to buy. "They're going to live with us until they're 40," Toll said matter-of-factly. "And when they have their second kid, then we'll finally kick them out and make them pay for the house that we paid for. And that house will cost them 45 to 50 percent of their income."
...
I grew alarmed. Was he kidding? He assured me he was not. "It's all just logic," Toll said. "In Britain you pay seven times your annual income for a home; in the U.S. you pay three and a half." The British get 330 square feet, per person, in their homes; in the U.S., we get 750 square feet. Not only does Toll say he believes the next generation of buyers will be paying twice as much of their annual incomes; in terms of space, he also seems to think they're going to get only half as much. "And that average, million-dollar insane home in the burbs? It's going to be $4 million."

The reason that this is not a case of 20/20 hindsight is also found in the same article.

The slackening demand for homes in autumn would drop more drastically if the larger economy were to slip into a recession. Or it could drop, as the Yale economist Robert Shiller has pointed out, if investors lose their "irrationally exuberant" conviction (unjustified by historical data, in his view) that their homes will undoubtedly appreciate for the foreseeable future.

The arguments for the existence of housing bubble and its enormous destructive impact were argued far more logically than the claims based on wishful thinking. Shiller, Calculated Risk, Mish, Bill Fleckenstein, Jim Grant and countless others had been cautioning about the coming storm. Like it happened in all other bubbles in human history, the nay-sayers were ignored.

As is always said and always ignored - those who don't learn from history are condemned to repeat it.

But I won't complain - I am willing to sell my house to Mr Robert Toll for 4 million now ;-) I am sure he has some cash lying around. As he had sold a huge bunch of his company's stock when he was making such claims.