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

To: GraceZ who wrote (1259)	12/29/2001 9:04:06 PM
From: MSI	Read Replies (1) \| Respond to of 306849

>>the company would allow me to have a monthly P&I that was up to 23% of my adjusted monthly gross<< It's higher than that now. My anecdotal story is a group of young tenants in the Bay Area who are looking for a nice house in the 1 mill range, who I advised to be careful, in January, expecting this downturn. They are grateful for that advice and are watching prices soften, but are still prepared to go 1/2 of their income for housing expense, which is, as you say, too high, at least for my way of thinking. Many people are conditioned to believe "prices always go up, so get in now", and will be disappointed if they get in too deep in a downturn, or lose their job. I think that habit will take a few years' downturn to unwind, and we may not get that. Population pressure doesn't look like it'll abate anytime in the forseeable future. Due to tax incentives and price expectations many buyers are like developers, the only thing that will stop them from buying or building is lenders' absolute refusal.