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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: portage who wrote (70411)	2/25/2001 4:51:04 PM
From: A.L. Reagan	Read Replies (1) \| Respond to of 99985

Thanks for the update on Bay area real estate trends, and your commentary which makes sense to me. While Zell no doubt got a good price (he almost always does), the Spieker portfolio was by no means sold at "recession" prices - maybe "cooling off" prices, yes. You can see the "cooling off" in the overall U.S. Real Estate equities index chart I posted yesterday. Appreciate all the different views from around the country.

To: portage who wrote (70411)	2/25/2001 8:49:02 PM
From: Sea Otter	Read Replies (4) \| Respond to of 99985

What's your take on expensive housing markets? Here in the Bay Area, housing is everything in terms of people's psychology of wealth. Well, perhaps not everything, but certainly a good portion. At parties no one wants to talk about their stock returns (not anymore at least), but house-returns are topic #1. The general expectation around here is that housing is immune to the stock bear market and to the economy in general. (For instance, a friend of mine just spent 700k for a scrubby little fixer-upper in Belmont, with a nice view of the freeway. As he put it "it can only go up"). The idea being that this market can't go down due to the high demand and the low interest rates. Given that most everyone has triple-figure appreciation around here, folks seem to think the macro economic negatives won't hurt them as much. I'm curious if you, or someone else, has any analytical opinion on this. Are expensive housing markets indeed immune to stock effects? And to broad economic effects? If expensive housing markets stay strong, then presumably this would contribute cushion to the much-desired soft landing.