Thursday, January 28, 2010

Wonder If This Had Anything To Do With The RE Crisis?

Look at the Fed Funds rate since 2000. It sure seems to track the national housing bubble well. Now, I don't want to be Al Gore-like and assume this correlation. I wander what will happen to housing prices when the Fed starts raising rates this year? It is astounding to me that RE prices are this low with mortgage rates so LOW!

Mr. Bubble


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4 comments:

  1. AnonymousJanuary 28, 2010 at 11:22 PM

    According to the S&P Case-Shiller Index, house pries in the US as a whole fell by 32.6% between the peak in the second quarter of 2006 and the trough in April 2009. There has been some recovery in the past few months (seasonally adjusted ONLY) *entirely* as a result of government subsidy; the index is now down 29% from the peak.

    Note, a few lenders were audited last year by the FHA and were shut out of the program for originating too many risky loans. These same institutions closed their doors the FOLLOWING day. That is how nationalized our mortgage market is; without tax payer subsidy and guarantees, there would be no mortgage market, no more usurious, socially and economically destructive pricing, and in the long run, a healthier economy, as people's salaries would be freed up for other investments/discretionary purchases. What's really disgusting is that tax payers are literally paying the commissions of real estage agents. What a vile misappropriation of taxpayer dollars.

    Renting is the way to go, folks. IF you can rent the same place for half of the mortage payment, and none of the maintainance -- why wouldn't you?

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  2. AnonymousJanuary 29, 2010 at 12:18 AM

    http://www.mybudget360.com/wp-content/uploads/2010/01/the-cost-of-homeownership1.png

    'nuff said

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  3. AnonymousJanuary 29, 2010 at 1:14 AM

    Everyone talks about free markets -- meanwhile, there is no free market when interest rates are gigged to keep house prices artificially inflated. And never mind the interest rate issue -- howabout the bidding process? This is another glaring affront to the free market forces because there is no transparency. The supposed "bids" from other prospective buyers are very often faked to get a potential buyer to pay more -- also known as shill bidding and totally illegal in any other market. There should be legislature passed to make the bidding process public record, and have each bid validated by a bank.

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  4. AnonymousJanuary 29, 2010 at 8:35 PM

    http://austin.bizjournals.com/austin/stories/2010/01/04/story3.html

    Austin homes are overpriced, study says

    ReplyDelete

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