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.

Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: J. P. who wrote (786)	9/4/2001 6:15:21 PM
From: patron_anejo_por_favor	Read Replies (1) \| Respond to of 306849

Data points: Mortgage delinquincies and foreclosures continue to rise according to the Mortgage Bankers Association of America: cbs.marketwatch.com

To: J. P. who wrote (786)	9/4/2001 7:14:43 PM
From: Tradelite	Respond to of 306849

<<what would be effect of rising interest rates>> Interest rates are so historically low these days that buyers should not feel bad if they go up a bit--rates would still be relative bargains. Buyers should only feel bad that they waited so long to buy. <gg> Most buyers aren't in a position to let rates change their plans to buy, because they are relocating or are buying because they need a bigger house for the family. I've sold as many homes at 9-plus percent interest as at lower rates--but since today's younger buyers have never seen rates that high, they'd probably croak from the shock, so maybe we should buy stock in funeral homes if 9 percent rates show up????. Seriously, if rates rise, people sitting on the fence about buying (waiting for lower rates or lower home prices) will immediately get off that fence and do it. They'll probably choose adjustable-rate mortgages. Home prices will gradually come down to meet the affordability standards of the marketplace---the supply/demand factor at work, as always. Yes, refinancing always grinds to a halt when rates rise even a little--- when that happens, there aren't many people around, holding loans with rates high enough to justify going to the trouble of refinancing. You also asked about high-end real estate buyers.....Around here, most high-end buyers can afford what they're buying no matter what the rates are. They have huge down payments, or they pay cash for their homes. The number of home buyers today who have inherited large sums of money from grandparents or parents is staggering. Also there are always large numbers of wealthy foreigners buying high-end real estate in the DC area--they often pay cash. Many high-end buyers buy expensive homes as an income tax sheter, so they don't care about paying higher rates, anyway---the interest is deductible. Can't speak for other regions of the country.