Sounds a lot like goldbuggery.
Further, if you had to pull out all the stops just to get in, and got a "sub-prime" loan, when that thing converts you are royally screwed.
What about using interest-free credit card advances?
Posted on 09/20/2006 10:26:44 AM PDT by GodGunsGuts
Can Wall Street withstand weak housing?
Some experts say real estate slump may spell trouble for equities
ANALYSIS
By Peter Coy BusinessWeek Online
Updated: 1:28 p.m. PT Sept 19, 2006
If your nest egg is made of 2-by-4s and you're watching the real estate slowdown with a mixture of fear and nausea, then this article is for you.
The question: If real estate tanks, will stocks follow? Or will the market ignore housing? Or maybe — just maybe — will a decline in housing trigger a rise in stocks? It's something you really ought to think about if you're trying to figure out where to put your money.
(Excerpt) Read more at msnbc.msn.com ...
Whether the town mandates more lots or less they create significant disincentives to development by effectively handcuffing developers from using their land in the most rational way.
A developer would rather install plumbing, heat, electrical, etc. for two 500K houses than 8 150K townhouses.
His margin is much better.
It's a little frustrating arguing with people who are unclear on what banks actually do, so a little humor is definitely in order.
>>I see. I'll just point out that the more money I earn, the more credit is available to me as well.<<
That is true, and anecdotal. A lot of people got rich from the 1929 crash but it does not mean it was the norm.
Having a brother, a wife and a daughter in the real estate and mortgage business gives me a not all that uncommon perspective on just how much credit is being offered to people that don't make much money at all. It is, frankly, unprecedented. The fallout will be as well.
Any of that illegal? Should it be?
Let's unanecdotalize it, then.
Fact: if a person's income increases, the amount of money banks are willing to lend to them increases.
It is the norm for one's credit access to increase in line with one's income.
Whats going on with housing is that the great post-war baby boom has finished moving into the family home phase, which is the main driver of the real estate market. So, from now on you won't have ever larger numbers of families moving into the market every year. Hence the market is plateau-ing.
If want to make money in real estate, you need to figure out what will be the housing preferences for boomer retirees. Anybody got any ideas?
This has the effect of pumping huge amounts of liquidity into the property market with the accompanying runup of prices.
Of course what these borrowers are now discovering is that a house is not a liquid asset, you can't just call your broker and unload it at today's price.
We need to get back to prudent lending standards, there will be some short term pain but in the long run it's the only way.
Sounds a lot like goldbuggery.
Further, if you had to pull out all the stops just to get in, and got a "sub-prime" loan, when that thing converts you are royally screwed.
What about using interest-free credit card advances?
I think that's a gross exaggeration.
The regions that have the highest housing costs & have experienced the greatest run-ups are all 'land scarce'. Not in absolute terms, but relative to the primary drivers effecting each region eg weather, jobs, beauty (water, hills, trees).
The best examples are, of course, the SF Bay area, SoCal, NYC, Boston, etc. Sure, one can move out to Sacramento, but the desirability delta is significant enough to produce huge differences in home values. Ditto coastal SoCal - 10 miles can put you from the beach in Santa Monica, PV, Newport Beach to inland LA/OC where gangs rule & life is cheap.
People currently pay, have always paid, and will continue to pay relative to all other factors, a huge premium to live in these desirable areas where "new land isn't being made".
You and your cohort cooperate (tacitly or explicitly) to flood Free Republic with doom-and-gloom democrat talking points and bad economic analysis. Such is the very essence of goldbuggery and gloomwhoring blogpimpery.
The NAHB index has fallen by over 50% so I wouldn't buy any stocks for the next 12 months.
October is seldom a good month for the stock market. Hopefully the worst of the decline holds off until next year.
BUMP
OK, let me correct that to anyone who can fog a mirror, has a SSN, and can sign their name. Google "no doc loans" for further info.
Can Wall Street withstand weak housing?
No.
Still a gross exaggeration.
Excellent points. Do you have a chart or a link that demonstrates said correlation?
That will happen shortly after all we get flying cars.
Taking into account larger houses and higher incomes, it looks like housing is more affordable than it was 1978.
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