The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: GraceZ who wrote (28812)	3/28/2005 1:56:37 AM
From: John Vosilla	Read Replies (1) of 306849

How does a 5-10% drop in value of an asset in which you have little financial interest ruin you? Usually that person is younger and more predisposed to spend all his income. A collapse in values will hurt consumer confidence dramatically, destroy credit, destroy families and take an even bigger part of the homebuyer market out of the demand portion of the equation perhaps deflating values for a generation in a new environment that might not be as friendly for bankruptcy filers. Today just seems very different from prior periods and doubtful that rising incomes or declining interest rates will occur to bail out folks today. Add in the relative cheap rents versus high ownership costs today and it tilts the scale even more towards bailing from an upside down property.

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