jdl51

Property Values Set to Fall 43% from Current Depressed Levels

Fortunately I bought property in the '80s and '90s and have done fairly well, even if we get to the Armegeddon levels the author is predicting. Just looking at my area, S.Florida, another 40% plus drop seems highly unlikely. That would put waterfront homes in the 150s which haven't seen that level since the early '90s, late '80s. At those prices and at present interest rates, which are at historic lows, people would be snapping up property down here so fast it would make your head spin. Imagine you're a European and you could get a really nice condo on Miami Beach for less than 60,000 euros. There is a support level under this market and it is not 40% down from here unless the entire world economy goes completely down the tubes. At present the opposite is happening, with China growing near 9%, the U.S. showing positive growth, EU economy starting to expand, interest rates close to zero in some countries and global stimulus still with the pedal to the metal. If there is any improvement in employment, which at current productivity rates seems just around the corner, the stabilization will be firmly in place.

Fannie and Freddie Did Not Cause This Crisis

"THESE AGENCIES SOUGHT SUBPRIME AND ALT-A PAPER in order to expand low income and minority home ownership at the request of the Democrat controlled oversight committees in Congress."
----------------------...
The democrats didn't gain control of any committees until February of 2007. The republicans were in charge of those committees and not only didn't oversee anything, were actively encouraging banks and lenders to step up their activities. Bush repeatedly stopped efforts by various state governments to rein in predatory lending practices. Minority loans are but a small percentage of troubled mortgages in this market. Here in S. Florida there are thousands of multi million dollar beach front/ocean view properties that are in default that had nothing to do with Fannie or Freddie. You have to remember that Fannie had mortgage limits that have only recently been raised. You could not get an FHA mortgage over, I believe, 300,000 until recently and a large percentage of defaults are over this amount. This blame Fannie by the repubs is trying to draw attention away from their lack of oversight and incompetence and which also has a not so subtle racial element to it although most FHA mortgages are to white folks.