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

To: Mike Johnston who wrote (32863)	6/7/2005 4:17:02 PM
From: Wyätt Gwyön	Respond to of 306849

The only way i can be wrong about this is if the Fed creates hyperinflation. it seems to me the Fed is giving indications--like these statements from regional Fed leaders--that it will not promote hyperinflation to prop up the bubble.

To: Mike Johnston who wrote (32863)	6/7/2005 4:38:18 PM
From: Tradelite	Read Replies (5) \| Respond to of 306849

You asked: what is going to propel prices further? Maybe nothing. Real estate markets don't just go up and down. Sometimes they operate in a state of relative equilibrium. As for it being a "no brainer" to sell right now, seems to me it would take quite a bit of brainpower and soul-searching for the typical homeowner/family to decide to uproot itself, pay sales and moving expenses, squeeze into a rental costing thousands of dollars per month, give up mortgage-interest and property tax deductions, move the kids to a different school and neighborhood, alter the parental job commute, and hunker down waiting for the opportunity to once again find the right home--at a totally unpredictable price-- and pay moving expenses, transaction fees, and everything else it takes to settle into a new home. (Whew!) Not everyone who has bought homes in the past five years is a real estate speculator buying properties he/she doesn't intend to occupy. Not every town in America has been affected by real estate mania, and many haven't seen much of any price appreciation at all. Not every buyer is coming to the table with only one income in the household and no down payment (so some of the statements about how prices can't go up because wages and salaries aren't going up accordingly do need some qualification every now and then). So if a bunch of crazy speculators in certain cities get burned when and if the market turns substantially, they will richly deserve it. But they probably won't bring the whole country down with them. (My opinions only)

To: Mike Johnston who wrote (32863)	6/7/2005 6:06:23 PM
From: Valuepro	Respond to of 306849

Mike Johnston, "There is no such thing as a free lunch and money and wealth cannot be created out of nothing." Quite so, in the long run, but this is what (very) fractional reserve banking, legal tender laws, and fiat money are all about.

To: Mike Johnston who wrote (32863)	6/7/2005 10:26:15 PM
From: John Vosilla	Read Replies (1) \| Respond to of 306849

Tradelite is right there are a ton of people who bought RE just as a place to live in and are not speculators. I wonder what is going through the head of a struggling paycheck to paycheck person who never could save a penny and as luck would have it bought a modest FHA insured no money down house for $125k in a bubble market 4-5 years ago that is now worth $400k. It would be very tough for them in the here and now not to take some drastic action with this new found wealth that is almost like winning the lottery.