Posted on 06/20/2005 8:11:58 PM PDT by ambrose
FDIC warns of housing bubble:-
NEW YORK | June 20, 2005 8:22:17 PM IST
The Federal Deposit Insurance Corp. is warning the U.S. housing market is in danger of a serious disruption because some markets are ultra-pricey.
FDIC data indicate the nation's most overheated local housing markets now make up such a large share of the total U.S. market, a sharp fall in their values could stall or slow national economic growth, the Wall Street Journal reported Monday.
The agency found the 22 major metropolitan markets with the fastest-growing house prices account for 35 percent of the value of the nation's residential real estate but just 20 percent of its population.
It's a widespread boom and has macro implications, says Richard Brown, chief economist of the FDIC. A slowdown would not only hurt these markets, but the U.S. as a whole. (UPI)
It's an eyesore.
The show homes in Waukee would probably cause many on the coasts to shake their heads.
My kids are in the Waukee district, I would put that up against most districts nationwide also.
True. We almost bought a house in Dallas for $140,000 in '88. That house is currently worth $170,000. The house we did buy in San Diego for $218,000 is now supposedly worth $750,000.
It's only worth what someone will pay for it. I certainly wouldn't pay $750,000 for this house!
Where is "here?"
Yep, pretty soon it will also be that way for Coolidge and Florence. And, pretty soon it will be housing all the way to Tucson...
Central Iowa
We were out at the home show last week, the Spanish style was a little over the top with the hidden "men's area" behind the bookcase. Wasn't that one around $650K?
My daughter just finished up KG in the Waukee district. Even said the pledge with "under God" still in it every morning. Gotta be careful though, or the home-schooling posse will be along soon telling us that we're abusing our children. (Not that there's anything wrong with homeschooling...)
Now would be a smart time to sell that house for 330,000, and rent for a year or two.
I agree. Hideous.
You may not recall the vast tracks of unfinished homes in the LA area that sat for years, some until they needed to be torn down in the early seventies. It has happened in California before.
Maybe it will end if our country ever made it against the law to rent housing to illegal immigrants, or they are sent packing back to their country of origin.
Those Californians are primarily from the Los Angeles and San Francisco metropolitan areas. They're gobbling up homes here in the Central Valley of California too. The frenzy has spurred the building of even more housing tracks, and the number of people buying these new homes was nearing 30% for investment purposes a couple months back, and rising. It really puzzles me. These people sold whatever investments they had, bought up these homes as investment properties here in the valley, yet most of the property may sit vacant as we've a very high rate of unemployment. The buyers aren't here. The renters aren't here. And buyers are less inclined to move here with rising gas prices. Something has to give. When it does, we'll have some of the best bargains in the nation.
I live in Emporia, 30 mins from Topeka,an hour from Wichita and about an hour and a half from KC.
I finished the M.A. here at ESU and started grad school at K-State. When I figured it up it's actually cheaper to live and work here and commute to KSU for night classes two nights a week. I can keep my full time job and still save a paycheck a month!
As a young single grad student, my goal is to keep debt down.There is no reason why people in similar circumstances cannot live frugally. When I lived in Cali I worked 2 jobs just to survive and I was constantly broke! No matter how much I budgeted, I was always a paycheck away from disaster in Cali. Here in Kansas, I go to work, go to school, and have money left over every two weeks!
If I were married with kids, it's be different, but for now I'd rather live cheap here in middle America.
In my neighborhood , north NJ , 1950s era , lower middle class working mens homes are now hitting $600,000 to $750,000 .People are paying that price , knowcking down the house and building (slaping together ) these huge homes and selling them for one million. The price of homes here has gone up mor ein ONE YEAR than it usually does over a whole generation..Bubble? Hell yea..Cant keep going on like this or else the average Joe will need 2/3 million to get a decent house in the next 3/4 years.
When you say California has never experienced a bubble burst, it is clear you haven't done any research.
For the most recent bubble burst, see Southern California RE from 1993 to 1998 or so. There were many other "adjustment" cycles previously as well.
But most never learn, and many profit incredibly from the high anyway--oftentimes enough to compensate for the inevitable low.
" They will only be there for 3 years so why not rent is my thought...I'm afraid of the bubble problem too."
I had to change stations every two years for ten years. During that time we rented. When I finally settled down I made sure it was when we were planning to stay 5 years. The peripheral costs of buying and selling a home that often were prohibitive.
one bedroom apartments in ok parts of Burbank, Ca, $1100.00 per month and up.
I just got a pretty good deal on a 2 bdrm in San Mateo up in the hills. The guy came down $100 a month on the price because it had been empty for 3 months (found that out from the electric company). The price for rentals has dropped considerably from the dot com days. Now if I were to buy a placeof the equivalent size, it would probably run at least 550K. The cost of renting around here is no where near the cost of buying.
See Housingmaps.com for a look at a great application of Google maps and Craigslist. It brings a lot of pricing information into the marketplace.
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