It certainly won’t help with home prices in the range you are talking about Rich from $600,000 to $900,000. I’m not sure how anyone can try to even look at it as it being nothing less than a big negative for home prices. That’s why the realtor lobby group is fighting it so viciously….
It’s not going to help things at the higher end of the market and the NAR knows it.
Personally I think it’s a healthy development. It’s healthy that they are working to ease out of the market and as they do, loans should get more difficult to get and as they do it will put more pressure on home prices.
Economics 101.
I’m not saying they will cause prices to plummet because I don’t think they will. But no one can argue it’s a positive development for home prices and the direction of them.
Let’s be honest….. guys like that flight attendant have no business buying a $700,000+ house in the first place and the reduction of the loan limits will help prevent people like him from buying more than they can afford.
Don’t forget just how high the % of negative equity is right now. 28.4% plus the near negative equity #’s out there. Ugly.
Yeah, real estate prices vary in various areas like California and New York. But my philosophy is if you can’t afford a given area, move to a cheaper area that is more affordable.
