Housing's last hurrah

CNN/Money ^ | August 20, 2003 | Mark Gongloff

[AntiGuv]

Despite last month's rush to build, the headiest days of the housing market are near an end.

NEW YORK (CNN/Money) - If you're being deafened by the sound of hammering and sawing in your neighborhood, as one or five or 20 new houses are built around you, you might think the U.S. housing boom is stronger than ever.

[MeneMeneTekelUpharsin]

I know most of this is political hype to help change the party in power, but the underlying truth is valid. The home-building boom is not going to last with interest rates rising. Simply will not last. Then what?

[DooDahhhh]

Well it can't be good for me. I am a real estate agent. However, that is just partly true. When the market is red hot, everyone and their brother gets a real estate license. When the market goes a little south, they leave the field for a steady paying job, leaving more business for the old farts in the field.

[OldFriend]

CNN just a hopin' and a prayin' that the housing market fails, the economy fails, the market crashes......etc etc etc

[proxy_user]

This will be bad. Who is going to get stuck holding the 5% mortgages when rates rise? You can be sure that very few of them will be paid off in advance.

And what about all the homeowners who end up under water? If house prices drop even slightly, many houses will be worth less than their mortgage. Any kind of job loss or other financial disaster will put the loss squarely back on whoever's holding the paper.

[Princeliberty]

This is not hype. If anything understatement.
If you are Democrats the problem is that Housing
will not go down quick enough to ruin things before 2004.
They may be why the report is understated.

However, the Housing market has been one the thing
used to prop up the economy with its continued expansion
the economy will really be in bad shape.
And were Housing is real in for mean have is after
2004 then things could start getting really
bad as huge debt continues to push interest rates
higher.

[Tailback]

I'm curious as to what will happen when droves of baby boomers retire and sell their homes to hit the road in motor homes. I suppose vacation and retirement property might be booming still but large houses might be hard to move. Oh well, whatever happens it won't be dull.

[John O]

"The economy is picking up from a pathetic pace to something better, but the big question is what happens next year, when there's no more tax cuts and mortgage refinancing to boost growth,"

Here you have it. The first call for another round of tax cuts!!!! YAHOOOOOO lets get those pencils sharpened and start trimming fedgov spending. Give me my money back!