text: You forgot the part where you sold at the height of that bubble so by 1996 the house was $185,500 and didn't get back to $265,000 until 2002 or 13 years later. Therefore, the person you sold to would have lost more than you paid for the house if they kept it as long as you did. Moral of the story, timing is everything. The question is when will 1989 happen this time around. Also, the leverage is WAY higher now that it was in 1989. In 1989 leverage was 3 to 1. Now it is 10 to 1 or higher. HELOCS didn't exists either and that exacerbates things downward. Big difference.