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Posted on 07/23/2012 5:19:02 PM PDT by BenLurkin
The United States is headed toward another real estate collapse — and it will be worse than the one we just experienced, according to famed economist and New York Times best-selling author Robert Wiedemer.
During his recent appearance on the Aftershock Survival Summit, Wiedemer provided startling evidence to support his claim that real estate prices could fall another 32 percent.
That would wipe out another $64,000 in equity from the average home.
Before you dismiss Wiedemer’s claims as impossible or unrealistic, consider this: In 2006, Wiedemer and a team of economists foresaw the first collapse of the U.S. housing market and published their research in the book America’s Bubble Economy.
Now Wiedemer is back with an even stronger warning.
He says that all of the positive housing news lately misses one critical item, and it’s the one that will sink the housing market sometime in late 2012 or early 2013.
Wiedemer states that the media (and most notably the National Association of Realtors) wants us to believe that housing prices have bottomed, and that right now is the perfect time to go out and buy a home.
They will point to a leveling-out of home prices and a sudden lack of inventory as an indication that the housing market is heating back up.
One “expert” goes so far as to say that real estate “has not just bottomed, but is booming” and talks of reported bidding wars on homes in locations like Seattle, Austin, and Palo Alto.
But Wiedemer believes that all of this positive news for the housing sector ignores the one factor that will cause housing prices to plummet: Interest rates will eventually rise.
(Excerpt) Read more at moneynews.com ...
Insofar as the banks are sitting on a lot of REO, the incentive is to keep the interest rates down for the short term. After all, the cost of keeping a $ 250,000 foreclosed mortgage on the books is only about $ 625 per year (250K x 1/4% interest paid on savings). When the owned inventory is gone, the rental rate on interest will rise as will savings account interest. Supply/demand.
They didn’t even mention skyrocketing property taxes and utilities...and ever more strict codes to comply with...with each mandatory upgrade requiring permits and licensed contractors who themselves are over-burdened with strangling regulations.
Ain’t this news about 3 years after the fact?
What will that do to rents? I own several rental properties and looking for more.
THe answer is in employment/ unemployment.
Which is growing?
Remember.... small business did not build that...
THe answer is in employment/ unemployment.
Which is growing?
Remember.... small business did not build that...
The market needs to be left alone and not propped up by the Barney Franks and Zeroes of this world. If the market forces prices down, so be it.
In some cities 50% of the mortgages are underwater and people cant sell their houses to move out up or down. So they aren't looking to relocate or trade up.
Add tax increases (and loss of tax deductions for mortgage interest) on anyone making middle income and above, and student loan debt to the mix and where will you find buyers for all those homes the boomers need to dump over the next 10 years, and that the builders want to build?
It just seems that demographics favors a shrinking home buyer market
Makes me want to buy land. I’d much rather own fertile acreage than gold or any other investment. First, I love the idea of being ‘away from it all’ as much as possible (the more crazy the world becomes - as I see it - the more this is true). Second, if you have land, you can grow food etc. You can’t eat gold.
The government with the most powerful military in the world by far....
...won’t let the interest on it’s huge debt go up easily.
So I think it will be a while before rates go up much.
...according to famed economist and New York Times best-selling author Robert Wiedemer.Wait, what?
Japan and Europe will buy bonds at low rates if that is what will keep the US military defending their interests.
China will if it will keep us out of their way.
Little countries will fall in, of course.
I’m not saying it in a positive way
A big military with big, foolish, debts is not a good thing- it’s what those ‘compassionate’ Keynesians are turning us into though with their good intentions.
“just don’t see the market as flooded. maybe there’s not enough people who can get the credit to buy something, but the population isn’t decreasing.”
More foreclosed properties could flood housing market, pushing values down
http://www.oregonlive.com/business/index.ssf/2012/07/more_foreclosed_properties_cou.html
The Foreclosure Forecast for 2012 - Get Ready for a “Flood” of Foreclosures
http://www.youtube.com/watch?v=i7MVyQUgu0Y
ping
Whatever the outcome, it sure has been an all-out war on the middle class.
FUBO.
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