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FDIC warns of housing bubble
UPI ^ | 6/20

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)


TOPICS: Business/Economy
KEYWORDS: codswallop; fdic; housing; housingbubble; panicforfools; re; tinfoil
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To: ambrose
Anyone who considers buying a home at these inflated prices should be very concerned about one big issue -- property taxes. If you can afford the mortgage on the home and plan to stay there for 10 years or more, you still have no control over what your tax situation will be at any time down the road (no matter how certain you are about the mortgage payment for the next 30 years).

The ultimate "disaster scenario" that I envision -- particularly in parts of the Northeast, is this: the housing bubble bursts at the same time property taxes are climbing through the roof. This means you'll start seeing a lot of people who can't afford to keep their homes but can't afford to sell them, either. Oh, boy -- what a nightmare that would be.

61 posted on 06/20/2005 10:24:04 PM PDT by Alberta's Child (I ain't got a dime, but what I got is mine. I ain't rich, but lord I'm free.)
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To: ambrose

In the newer sections of N Dallas/Plano/Richardson/Allen/Frisco, you can buy beautiful homes for 77-84 per sq ft. Unheard of in other parts of major metro areas.


62 posted on 06/21/2005 6:41:02 AM PDT by devane617
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To: It's me

In the newer sections of N Dallas/Plano/Richardson/Allen/Frisco, you can buy beautiful homes for 77-84 per sq ft. Unheard of in other parts of major metro areas.


63 posted on 06/21/2005 6:41:21 AM PDT by devane617
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To: Husker8877

There is a difference between an adjustment and a bubble burst where the properties are seriously de-valued.


64 posted on 06/21/2005 6:59:06 AM PDT by hope
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To: American Vet Repairman

My sentiments exactly. Thanks for your confirmation as to my suggestion and thoughts but you know young people. I will certainly pass along your comments.


65 posted on 06/21/2005 7:19:44 AM PDT by TatieBug
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To: inkling
The housing prices in the Phoenix area are ridiculous.

I've seen shacks in Phoenix for over $400,000

66 posted on 06/21/2005 7:41:20 AM PDT by Black Tooth
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To: ambrose
They are high everywhere. Check this out in Phoenix for $375.000.00 3 bd 2 bath, with NO GARAGE!

Plus you get those 115 degree days!


67 posted on 06/21/2005 7:55:30 AM PDT by Black Tooth
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To: hope

Where I'm from, I consider a 44% decline in the value in 3 years to be a "serious" de-valuation. And this is in a Southern Cal beach community! Yeah, for me personally, and for many many others in Southern Cal at that time, it was pretty friggin' serious.

Like I said in my post, however, it did obviously recover (actually several times over) so the bubble burst was temporary--probably the same as the coming bubble burst will be, I'd guess.

I really should put my money where my mouth is and buy something else, no matter how overvalued and ridiculous the properties are!


68 posted on 06/21/2005 8:17:14 AM PDT by Husker8877
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To: cspackler

Well, it has that stupid "look at my chandelier" window, but it's not Palladian. I don't see how they ever got planning permission to build without it!


69 posted on 06/21/2005 8:20:07 AM PDT by HostileTerritory
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To: Mears

Most likely on a minimum 2-acre lot because of septic...


70 posted on 06/21/2005 8:21:04 AM PDT by HostileTerritory
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To: ambrose
FDIC warns of Housing Bubble......

Hmmm....sounds plausible...

$90 million home sets US property record

A 40-acre estate in the Hamptons - the Long Island summer retreat of New York's rich and famous, has been sold for $US90 million, a new US record for a residential property.

The New York Post cited sources close to the deal as saying the purchase was made by a Swedish industrialist who has rented the estate for the past few summer seasons.

Owned by Adelaide de Menil Carpenter, heiress to the Schlumberger oil company fortune, the property's main residence is relatively modest - a three-bedroom, three-bath farmhouse.

However, the estate includes a two-bedroom caretaker's house, two guest houses, several acres of tillable farmland, a fully stocked man-made fishing pond, a lap pool and, most importantly, a substantial stretch of private beachfront.

The sale nearly triples the previous Hamptons' record of $US32 million that Seinfeld star Jerry Seinfeld paid for singer Billy Joel's mansion in 2000.....

71 posted on 06/21/2005 8:23:50 AM PDT by OB1kNOb (Excrementum Occurum)
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To: inkling

PV isn't so bad, especially the hills between PV and Prescott. Nice area, spent a quality 5 years of my life there.


72 posted on 06/21/2005 8:25:13 AM PDT by Dead Dog (We no longer find slavery abhorrent. We embrace it.)
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To: Husker8877
"I really should put my money where my mouth is and buy something else, no matter how overvalued and ridiculous the properties are!"

Land in the outskirts! I am seriously thinking about West Texas...OBTW, us Zonies love you Cali real estate buyers:)

73 posted on 06/21/2005 9:09:40 AM PDT by hope
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To: shhrubbery!
I agree. Hideous.

It's an architectural happy meal.

LOL.

74 posted on 06/21/2005 2:21:36 PM PDT by Age of Reason
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