home prices are set at the margins…I’m sure you know this
the last several years of loose lending standards have enabled people who “should” be apartment-dwellers to purchase the low end of the market, thereby enabling the move-up market to get to dizzying heights. EVERYTHING has been dependent on the 7-11 clerk doing a stated income loan overpaying for a 100K “condo” by 200K. This is the stupid money. Once it dries up (it already has to a large extent) the game is over. Once we return to 5-10% down requirements (heaven forbid 20%) you will see that there is no-one left to buy the low-end stuff and the sales in the middle will all be must-sell and distress-sell situations.
Since the market is set at the margins…this will affect everyone regardless of what type of mortgage they have.
most of us are not here for investment advice…we are just here to chronicle the ongoing fraud perpetrated against Americans. Of course the hedgies have been making money hand over fist…they will continue to do so…does that mean house prices are not severely over the top?
No.
“Report mortgage fraud to the FBI, everytime you see it.”