Mark Moran

This Can't Be Helping Real Estate

Rising rates will greatly exacerbate the crisis. Right now, the problem of ARMs adjusting higher has been muted by the drastic rate cuts; as these cuts are reversed, the number of forced sellers will only increase. Further, tighter lending guidelines will mean fewer people able to get a mortgage, particularly to buy a home at today's still inflated prices. The only thing that will eventually turn the market around is when deep pocketed speculators come in, and they wait till there is blood in the streets, and when the cost of carrying a house again begins to remotely resemble the amount for which they can be rented, and prices have a good bit to fall before either of these is the case.