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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: John Vosilla who wrote (33137)6/11/2005 1:17:32 PM
From: TommasoRead Replies (1) of 306849
 
>>>Keep in mind RE did nothing from 1930-1955 across the board.<<<

That is certainly true, though I think rentals went up some towards the latter part of that period.

But keep in mind that although the U. S. did not allow its citizens to own gold, the dollar was still very mugh on an international gold standard during that period and after World War II was an extremely strong currency. The U. S. (it's hard to believe now) ran big trade surpluses.

In those days it was very hard to scrape together the price of a house our of savings from wages, or even the 20% to 40% down payment that some lenders expected.

But if some portion of the immense quantities of dollars that have been exported to the rest of the world comes back to the United States, the dollar-denominated price of real estate might not drop all that much. I understand that foreign buying of U.S. property has already increased a lot with the fallen dollar.

What does seem certain is that the people who are piling into the latter stages of this boom using vastly overextended credit are going to be ruined. What happens to the mortgage holders I wouldn't know. Maybe Fannie Mae will have a nation-wide yard sale of abandoned properties. If anything like that happens, though, I would not be surprised to see a lot of foreign bidders.
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