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

To: Jim McMannis who wrote (272982)	9/2/2010 4:43:21 PM
From: Lazarus	Read Replies (1) \| Respond to of 306849

of course it would... ....prices would adjust DOWNWARD. <<<<What if there is a minimum of 20% down and 6% interest? Would it be affordable then?>>>> i always tell people that what they pay for real estate is more of a function of the cost and availability of money then "what the property is worth" the real estate bubble taught us that when money is cheap and sloshing around freely the price of real estate goes UP. today - THE MONEY IS EVEN CHEAPER - but there is no sloshing and its only available to the FEW.... and even getting them a loan is like pulling teeth.

To: Jim McMannis who wrote (272982)	9/2/2010 4:55:13 PM
From: John Vosilla	Read Replies (1) \| Respond to of 306849

'Affordable with 3.5% down payments backed by the FHA maybe. What if there is a minimum of 20% down and 6% interest? Would it be affordable then?' Probably another leg down in overpriced areas that never fully corrected. I doubt it causes much of a ripple in the affordable areas as the supply pool will be in very strong hands with low fixed rate loans by then. Think 1970's if that even happens. Look we are probably going to have a decade of stagnant housing activity with much lower turnover and continued very low new home starts. Not a bad thing as we continue to deleverage and remember very low rates will spur new innovation in other industries much sooner.