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: bentway who wrote (37433)	8/9/2005 9:38:40 PM
From: CalculatedRisk	Read Replies (3) of 306849

If someone buys a house and: 1) can only qualify using an option ARM (or similar loan) and 2) Plans on selling before they are unable to make the payment. I call that speculation. And I believe speculation is the key to identifying a bubble. angrybear.blogspot.com Some people argue the bubble is confined to the coasts and a few inland locations (Phoenix, Las Vegas, Twin Cities, etc.). I disagree. I think the bubble exists anywhere there will be significant foreclosures if prices (or wages to make payments) do not rise over the next couple of years. My guess is that covers a huge portion of the US (much > 50% by population). The housing bubble will not impact most Americans directly - they have sufficient equity or can make the payments. However if the deflating housing bubble takes the economy into recession (something I think is likely) then the bubble will indirectly impact many more Americans.

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