Has it crossed your mind that the ‘smart people’ were the one’s touting real estate as being an asset class that has never lost value that might be wrong.
I never considered them smart. They are just sales people (realtors, mortgage bankers) or their spokespeople (Lereah) looking after their own interests.
Or was it the “smart guy” Federal Reserve Chairman Alan Greenspan who stated people are better off with adjustable rate mortgages over a 5.25% 30 year fixed rate loan who definitely was wrong.
All Greenspan said is that if you’re going to live in a house for less than 5 years, then you’re better off with an adjustable mortgage that resets not earlier than 5 years. For young professionals who work in industries with high labor turnover (high tech, pharmaceuticals), this advice is actually smart.
I agree with you that the RE market is cyclical, that it probably peaked in 2005, that this last peak was unusually high by many measures, and that we are about to enter a downturn that may last many years. The point of this thread is that, as reasonable as I think my observations are, I may still be wrong.
