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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (38197)	8/9/2005 12:28:00 PM
From: Wyätt Gwyön	Respond to of 110194

i think even if you live in a prime area, you might want to sell if your house is your dominant store of net worth. there are probably a lot of people in bubblezones who are newly minted millionaires in terms of home equity, but have negative or negligible net worth outside their houses. if i was in this situation, and if i would only save a small fraction through ongoing income of what i had passively accumulated the past couple years in home equity, i would think very hard about selling regardless of area. the low rents of bubblezones relative to effective housing costs make the decision easier.

To: Ramsey Su who wrote (38197)	8/9/2005 4:05:26 PM
From: anachronist	Read Replies (2) \| Respond to of 110194

A HOME IS A LIFE STYLE CHOICE, YOU DO NOT WANT TO RISK BEING PRICED OUT WHICH CAN HAPPEN VERY EASILY. I really hate to get into the inter-genrational conflict here, but God, that is such short sighted boomer talk. Being "priced out" is a myth that boomers have developed in affluent areas to explain away the massive asset inflation that has been going on. Do you really expect me to believe that home prices rise independent of income? That somehow the boomers were so blessed to be born when house prices were low compared to incomes, and that situation will never again appear? That youngsters today, not to mention future generations, will be reduced to competing for a smaller and smaller pool of available housing? That middle class families will pass down the family homestead form generation to generation, dividing between their siblings as prices grow to astronomical levels? "Pricing out" means that a person could not afford to buy the home they live in at its present price. Although that is possible in the short term, it is an inherently unsustainable situation in the long term. In the long term, home prices are a FUNCTION of income.