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

To: Les H who wrote (16033)	1/15/2004 12:25:14 PM
From: Tradelite	Respond to of 306849

This little discussion seems to be going off on a tangent, now, Les. Let's keep mind what launched it. I asked what someone meant when he stated homes in the DC area are "overvalued" by a specific percentage amount. To anyone in the real estate business, this phraseology sends up a whole bunch of question marks. It's like the time I was sitting in a conference room with an estate attorney who told the heir no capital gains tax would be owed on the house he inherited years ago but was now selling. He said: "Homes in this town have been fully valued for many years." WHAT THE HECK DOES FULLY VALUED MEAN, I screamed silently to myself. Valued by whom and according to what benchmark? Tell that to the IRS and see what it says. If prices drop by a certain percentage in the DC area, would anyone then sit back and comfortably agree prices are "right" or "not overvalued"? Where and when is this point ever reached? Questions, questions.

To: Les H who wrote (16033)	1/15/2004 12:34:03 PM
From: Tradelite	Respond to of 306849

<<see how many people can put up cash to purchase their homes>> If they hold onto them long enough, appreciation might well help them out of their low-equity positions. I realize the idea that real estate can continue to appreciate further in future years after its latest run-up sounds nuts, but it's also a little nuts to assume the world will go to hell in a handbasket, houses will drop 50 percent in price, and suddenly no one will want them, much less be able to afford them, anymore.