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To: Bucky Katt who wrote (12205)	6/3/2003 11:29:17 AM
From: George Burdell	Read Replies (2) \| Respond to of 48461

IMO home prices are an internet bubble waiting to happen. It may not be as absurd everywhere as here in Austin, but because rates, and therefore payments keep dropping, home prices kept right on rising despite the increasing levels of unemployment (and underemployment). Now there are three houses for sale on every block and foreclosures are rising. If the weaker dollar and deficit expansion cause rates to tick back up to any degree, there aren't going to be many Austin salaries that will merit paying $250,000 for a 3/2 on a postage stamp lot. Not to mention that housing has been a safe investment haven during the market meltdown. If the market continues to perk up and folks stop looking at housing as the best investment option, that could pressure prices as well.

To: Bucky Katt who wrote (12205)	6/3/2003 3:06:43 PM
From: fastcats	Read Replies (2) \| Respond to of 48461

Two somewhat associated thoughts: An empirical positive indicator on the state of the economy: I am semi-retired, which allows me to play squash in my home town several times a week during working hours. It is becoming increasingly difficult to find opponents who can play during the day... many are either going back to work after losing their jobs or returning to full time work from part-time. Unfortunately, some of them must move, but at least they have jobs. Next thing to think about on the dark side are the home improvemnet related retailers, like LOW & HD... My thinking is simple, home sales are slowing, and that also means valuations will not be going up like they were, and that means less refi money to buy dodads for the home... Another bubble about to be pin-pricked? The last time real estate prices eased in my town it was impossible to find a contractor... they were all tied up doing additions. Of course interest rates were substantially higher then and people with low interest mortgages, myself included, found that on a cash flow basis they could only afford to buy their own houses due to increased financing costs. Additions became the most attractive way to get more living space then and if prices ease substantially would look quite attractive again. Maybe HD & LOW won't fare too badly after all.