"Glenn Ashmore" wrote in message
news:ZX2%b.2713$Ri6.222@lakeread04...


Ed Huntress wrote:

Nationwide? I don't think so. The amount that's been re-financed over
the
last few years looks like a lot of debt overhead, but it was low
interest
rates, and reasonably low PITI payments, that made it possible. In other
words, unless the economy gets softer people should be able to pay their
mortgages. As long as they can, and unless values really collapse,
they'll
probably keep paying them.

In California? Who knows? Your real estate has been riding a bubble for
a
couple of decades, and it appears to be a pretty big one in some
locations.
If people panic, it would be just like any other bubble. Pop!

Out here, I think it's less likely. As for the lenders, they are
overloaded
with debt, which probably is what your link talks about. That paper is
already being discounted as rates inch upward. Financial institutions
that
have a lot of uninsured paper are very exposed and are vulnerable to an
economic downturn.

But, like I said, if I was really confident about it one way or the
other
I'd find a way to speculate on it and get rich. g

Ed Huntress


Agreed that California is a unique situation. The thing is, as
Californians sell off and abandon the state they put a lot of pressure
on Oregon and Idaho home prices. They have a lot of gain that must be
reinvested in homes within something like 2 years and that sends home
prices in Boise through the roof.

snip

The profit hasn't needed to be reinvested since about 1996. Before that,
prices were going up like crazy because of this. Since then, they've
just been going up!