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

To: TH who wrote (26071)	12/16/2004 5:06:05 PM
From: flint	Read Replies (2) \| Respond to of 306849

I've lived in Grand Rapids Michigan for a while. Wind sheilds, Auto parts and Chasis are the core of that economy. The culture on debt is very different in Michigan than in most of America. People live in fear of debt and unemployment. They were brought up to pay down their debts fast. Did not know anyone with a thirty year mortgage. Everybody buys with a 15 year mortgage. And the turn over is much lower. Most people have lived in their homes for at least ten years. Not only do they have large equity built up, but if people refuse to borrow money to buy a house. The housing bubble has no money in it to inflate the values. In Grand Rapids Michigan a $80,000 victorian house is in the excat same neighborhood and condition as a $1.5 million dollar house in Washington DC (remove borrow money from the buying abilities and that house in DC would sell for $80,000). These people can stay in their $80,000 house with $70,000 equity and survive on unemployment benifits of $350 per week. Moving to DC for work might not be possible for most of them. Flint

To: TH who wrote (26071)	12/16/2004 5:25:36 PM
From: AC Flyer	Read Replies (1) \| Respond to of 306849

>>I think the Detroit area is going to suffer as people migrate in search of jobs to replace those lost in automotive<< Any national forecast will necessarily average regional variations. Detroit is on the wrong side of a confluence of social, demographic and economic trends, so will probably find itself at the low end of the regional distribution of housing price gains. >>Do I understand that his spending wave forecast is calling for Dow 30,000 next year?<< I am not sure where you saw this. Possibly you misinterpreted the Spending Wave chart. Do you have a link? Dent has been consistent in forecasting Dow 30,000+ towards the end of this decade - 2009-ish: hsdent.com >>Dent also states he sees something of a top in 05 in real estate, with housing levels maybe sustained until 08<< It's interesting that while Dent is forecasting a stock market boom through 2009/2010, he is also forecasting prices in residential real estate through that period that will be in aggregate just flat to slightly up (there will be regional outliers, of course). He recommends eliminating any unnecessary exposure to residential real estate by 2009 at the latest. Of course, this is a trick that very few will be able to pull off. Even so, prices of the homebuilder stocks might well double or triple through 2008.