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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 (59726)	8/11/2006 11:17:54 AM
From: Lizzie Tudor	Respond to of 306849

we don't have any job growth anyway, and haven't for years.

To: Les H who wrote (59726)	8/11/2006 11:32:10 AM
From: John Vosilla	Respond to of 306849

Lending standards were extremely tight the first half of the 1990's. Complete opposite of today. One of the biggest factors that can turn this downturn downright ugly is much tighter loan standards and elimination of toxic loans.

To: Les H who wrote (59726)	8/11/2006 3:01:33 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 306849

What caused the real estate bubble to pop in 1989 in California? There were no more suckers to buy homes at those prices. Sales volume had been declining rapidly for some time, just as it had today, as fewer and fewer buyers could be found. Finally the mania just come to the end, as it is now. The TEFRA Act devastated the commercial real estate sector and vaporized the real estate syndication industry in 1986. But helped push up the price of homes. Some of the capital which would have gone into these sectors instead was invested in home, making the housing bubble in areas like California even more buoyant and disconnected from reality. So while TEFRA added to the bubble in home prices, it did not in any way cause the bubble to collapse. As for mortgage rates, variable rate mortgages were slightly higher in 1989 than 1987, but fixed rate mortgages were slightly lower. (see below) Both fixed and variable rate mortgages were dramatically lower in 1989 than they had been in 1985. And yes, some find a connection between the sun spots or women's fashion in 1989. But in the final analysis, it was simply no more buyers.