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

To: Tradelite who wrote (3706)	7/31/2002 3:38:47 AM
From: fatty	Read Replies (1) \| Respond to of 306849

>Jim, I think the one factor that makes this run-up more national in scope is demographics. >In my area of the country, new elementary schools are being built every year to accommodate the influx of students. Here in Boston, the city is closing up schools but real estate price still keep going up. My theory is that the initial run up was created by the people who cashed out during the tech bubble. Then as the bubble deflated, more money flowed into real estate and slowly building up another bubble. The crash is coming. Nobody can afford to spend 50% of their pre-tax income on housing forever. The demographics is just a lie. The apartment vacancy rate in Boston is close to 10%. It is now actually cheaper to rent than to pay the mortgage. People are buying with the expectation of making quick bucks in a year or two. Many properties sold in Boston are put right back to the market after the transaction is completed. The new owners don't even bother to move in or put a new piece of furniture. If this is not a bubble, I don't know what is.