[Homestead] Chicken Littlle squawks about those $750, 000 homes and price collapse
genegerue at ruralize.com
Thu Feb 17 07:20:41 EST 2005
>But now interest rates are rising, and many observers think the time of
>rapidly rising housing prices is nearly over.
What's this guy been smoking, popping or drinking? Interest rates are
amazingly low right now. I just checked: overnight 30-year fixed mortgages
are at 5.16. That is not only cheap money, it very close to free money so
long as it can be used in an investment returning six percent or more. And
it's tax deductible.
>*The end is near*
>The senior economist for CIBC World Markets in Toronto says a couple of
>more rate hikes by Alan Greenspan's Federal Reserve Board will effectively
>throttle the mortgage-refinancing market, and severely slow or even halt
>the growth of housing prices.
We have a serious problem today. The problem is that everyone with a
computer hooked to the Net thinks they are a writer or are trying to be a
writer, with the result that there is much garbage being written by people
desperate to see their names on a byline who have minimal knowledge of what
they write about and therefore write irresponsibly. "The end is near" has
been the scare headline again and again for the four decades I have been
buying and selling real estate and helping others do the same. There have
been rips and dips, as there have been in all economic arenas, and some
overheated areas like parts of California and Las Vegas definitely have had
unsustainably high appreciation rates that will garner correction. Overall,
the US housing economy is very strong. Real estate has been the linchpin of
the U.S. economy for many years. Here in The Valley of the Sun, over the
last forty years real estate has been the dominant and driving economic force.
More wealth has been made in real estate than in any other economic area.
Land is the most valuable natural resource. It is even more valuable when
it is improved with structures of human need.
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