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

To: Lizzie Tudor who wrote (49695)	3/7/2006 12:38:09 PM
From: John Vosilla	Read Replies (1) \| Respond to of 306849

"Imho a 20% decline in RE is a calamity mostly because people are so leveraged in RE." But are most really that leverged? I think it is a small percentage. You got speculators tied with ARM's and IO and the younger first time buyer not going to survive but they had zero net worth four years ago anyway. Sort of like the temporary dotbomb millionaire of 1999? Then you got a ton of 60+ who could care less and have their homes paid off.. Biggest hurt will be felt from folks in their 30's and 40's and even some in their 50's who thought they had finally made it, were doing well before the bubble and now stretched themselves too far in excesses and could lose it all. That retrenchement could be huge in some markets..

To: Lizzie Tudor who wrote (49695)	3/7/2006 12:54:09 PM
From: Think4Yourself	Read Replies (2) \| Respond to of 306849

re: "I do think we will probably overshoot to the downside, just because that always happens." I agree and we clearly aren't anywhere near the bottom here. We aren't near a bottom until the news is full of passionate stories about "hard working and honest" people losing their homes to the mean old bank that tricked them into buying more home than they could afford. We aren't near a bottom until everyone knows a RE speculator who lost everything. We aren't near a bottom until everyone thinks housing prices will never go up and no one thinks RE is a good deal. We aren't near a bottom until the mortgage broker next to the corner liquor store closes. We aren't near a bottom until congress starts passionately whining that "Something MUST be done!" and Fannie Mae has received a massive government bailout. We aren't near a bottom until all of those ARM's out there reset, and financially kill the fools that didn't get rid of them. We are nowhere near a bottom here. We have barely passed the peak. The bottom is years away. IMHO anyone who thinks this is just a blip is a fool who will have their financial head handed to them on a paper plate. The housing market is cyclical and we just passed the top of a massive speculative peak fueled by (practically) free money.