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

To: Tradelite who wrote (1631)	2/19/2002 4:31:09 PM
From: TheStockFairy	Read Replies (3) \| Respond to of 306849

The people that are huffy are in the market to buy and they have to pay cash out of pocket. Generally speaking, they want to pay their 20% down, get a good value on a house and not overpay. They are up against: 1) very very easy credit 2) people financing 97-105% of the value of the house 3) people rolling up gains from their old houses into their new houses (possibly a Ponzi scheme) 4) low interest rates Right now, the government (yes the good ol US government) has pulled pretty much every possible buyer into the market, which has made prices shoot up dramatically. In other words, the government has moved the demand curve while the supply curve has remained the same. The builders are finally stepping up to fill in the demand gap, according to the new building starts PR that was released this morning. So, prices have inflated and it's harder to find a good value in a place to buy in the short term. So, either supply is going to ramp up, interest rates are going to ramp up, credit will tighten or the housing market will have sucked every person in that it is able before prices head the other way. After all, they call it is a housing MARKET, which implies that prices fluctuate, not consistantly rise. At some point there will be move down the demand curve that will create buying opportunities also. BTW...$315k median prices for a home in Chicago is nuts.