The housing market is tied to employment. I live just west of what is called Northern Virginia.
Feb. 2005 sales in Northern Va. were 7800 houses. Feb 2006 the number was 7000. Prices are still going up but it takes a little longer to sell.
Employment is expected to increase strongly.
Location, location, location.
"March 4, 2004, Greenspan personally told people to use ARM loans."
Here is a FACT: For the last 20 years ARM loans have given people LOWER house payments, than fixed rate mortgages.
Reason: They took the RISK, and reaped the benefit of a low interest rate environment.
A few further facts:
1. Actually buying foreclosure properties takes a lot of knowledge, and the financial ability to pay cash in most cases.
2. Properties which are taken back by lenders will be marketed by same at full market prices.
3. Real estate is a long term deal.