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

To: Micawber who wrote (11200)	6/14/2003 9:16:15 AM
From: marginmike	Read Replies (5) \| Respond to of 306849

"I think the rapid appreciation can continue indefinitely," said Coldwell Banker's Montclair office manager, Robert W. Norman, "primarily because interest rates are so low." Mr. Norman said that based on typical mortgage computations, buyers who could afford to pay $1,800 a month on a 30-year mortgage loan would have been able to afford a $450,000 house two years ago — and now, with interest rates a percentage point lower, could afford a $600,000 house. If thats not bubble talk, dont know what is, sounds like someone describing JDSU back in 99

To: Micawber who wrote (11200)	6/14/2003 2:01:30 PM
From: fatty	Respond to of 306849

> Mr. Norman said that based on typical mortgage computations, buyers who could afford to pay $1,800 a month on a 30-year mortgage loan would have been able to afford a $450,000 house two years ago — and now, with interest rates a percentage point lower, could afford a $600,000 house. I wonder what is the 'typical mortgage computation' he was referring to? For a $600k house, assuming a 20% downpayment and 30 years at 5.25%, the monthly payment is still $2650. Of course, if the buyer put down a 45% donwpayment, the monthly mortgage will be reduced to $1800.