Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Jim McMannis who wrote (129436)	12/10/2000 7:40:15 PM
From: tejek	Respond to of 1570548

Jim Housing prices have risen substantially but you must also remember that it takes labor and materials to build new houses...therefor increases in wages and materials... Not all that money goes back into housing though...it could have gone into the markets...causing an inflation of it's own or say into extra leisure time, travel SUVs, whatever... Nothing acts in a vacuum... Actually, I meant the increasing cost of housing due to price appreciation due to market demand.....for both new and resale housing. Price appreciation can be more a factor of what the market will bear rather than the cost of materials. A prime example is the Tampa market....in the past, housing prices hardly went up even with new construction and solid population growth. The reason was that the level of construction was always greater than the level of demand. In any case, my point was that even with the change in the law re the sale of a primary residence and its gain, I think that probably less then 10% of the metro housing areas have experienced a 4% or more annual increase in housing appreciation in the last 3 years since the law was implemented. [Anything less than 4% I don't consider very inflationary.] And I would think if the new law is to be the cause of inflation, evidence of that would first pop up in an increasing rate of housing appreciation. Surely you agree that a tax elimination on pent up Real Estate value is a major inflationary factor...no? It can be if everyone takes their gain and spends it on cars and other products and manufacturers can raise prices acccordingly. However the reality was that manufacturers could not raise prices because of intense competition. In addition, I also believe that most people reinvested their gain in a more expensive house. So to answer your question, I think in this particular case the answer would be no. ted