Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: X Y Zebra who wrote (48384)	10/24/2003 1:47:17 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 57110

Yes, but if that demand continues, (as it seems to be), then the valuations will be relatively "safe" yes but here is the point i was getting at...what net effect does it have on the overall economy if housing appreciation simply decelerates...considering that housing and the cash infusions extracted from the "equity" (possibly inflated) begins to result in less liquidity to drive spending? and while i agree with you wrt immigration helping to prop up real estate....to borrow your phrase, "there is real estate and there is real estate"... there is immigration and there is immigration. while it is true that over time immigrants absolutely participate in home ownership, and thereby increasing the demand and subsequent valuations, my point is .....using s. ca as an example where there is high immigration levels which help to drive up RE prices....at what point do the (typically low wage earning immigrants) no longer afford the existing housing? car.org California Housing Affordability Plunges 5% in August The minimum household income needed to purchase a median-priced home at $404,870 in California in August was $93,490, based on a typical 30-year, fixed-rate mortgage at 5.66 percent and assuming a 20 percent downpayment. The minimum household income needed to purchase a median-priced home was up from $82,150 in August 2002, when the median price of a home was $334,270 and the prevailing interest rate was 6.38 percent. The minimum household income needed to purchase a median-priced home at $177,500 in the U.S. in August was $40,990. now assuming they come up with the approximate $810000 downpayment, they would need minimum household income of $93,490.00 to service the mortgage debt. my personal belief is that if we are relying on minimum wage (or lower in the case of illegals) types of incomes generated by immigrants are what is going to propel the housing market further, we're in more trouble than i thought.....especially as jobs are moving out of state... again i don't see a crash looming, even if rates creep higher, they are still at hovering at historical lows...just pondering the ramifications of a more stagnant housing market, meaning if housing slows, employment remains lackluster, do we get a double dip recession? check this out: Message 19430912