Homeowners need not fear. Homeowners have a place to sleep and eat. People who own their homes or have fixed rate mortgages are unaffected by a volatile market. If you didn't own a home, you'd have to pay rent somewhere. And that rent keeps skyrocketing. Those who own homes have a lot of positives going for them.
“Whoa cowboy! Read my comments. I wasn’t “bitching” (in your parlance). Quite the opposite.
Homeowners need not fear. Homeowners have a place to sleep and eat. People who own their homes or have fixed rate mortgages are unaffected by a volatile market. If you didn’t own a home, you’d have to pay rent somewhere. And that rent keeps skyrocketing. Those who own homes have a lot of positives going for them.”
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Count me as another that thinks you are bitching, protests aside.
A homeowner can be a person that either owns a home with no mortgage or co-owns his place with a bank. There is a big difference between the two.
If the homeowner is actually a co-owner with a bank and loses his income stream because the overall economy is in the toilet, then he has a lot to worry about, fixed rate APR notwithstanding.
But the bigger problem ahead for the real estate market is the impending consumer debt bubble which is about to make it’s presence known. Anyone who follows the RE market knows that the current market inventory is skewed in favor of either high end new construction homes or second (vacation) homes. A lot of the available inventory is actually surplus homes being disposed of to reduce personal liability exposure.
You must know this is a problem because you are not stupid but you seem to imply that all is well once the homeowner signs his mortgage paper. A 3.5% 30 year fixed APR on a home that is 45% of the homeowners income is going to be a disaster waiting to happen, plain and simple.
In short we in the USA seem to be incapable of living below our means and determined to make consumer debt the backbone of our financial planning. We are in what I think is the calm before the storm. Time to batten down the hatches, get out of debt, save some money for a rainy day. Buy opportunities galore are in the future but if the prospective buyer has 30% of their income tied up in Visa Payments, they will be watching train pass right on by.