sdrealtor, having watched the market out of curiosity for a long time, and more seriously in the last 2 years since I decided to move up, I tend to agree with you.
Houses were selling for $250-$300k in North County beginning in 1988. I don’t see prices dropping to this level. All else remaining the same, those prices would be a real bargains.
But you never know, if mortgages rates jump to 10% then all hell will break loose. Psychologically, the market will be crushed.
I’m at a loss to understand how interest rates will move. Many say that the Fed will lower rates if there’s a recession. But the goal of the Fed is to keep inflation in check.
The dollar is loosing value, the subprime lending business is imploding. Foreigners are taking a bath on their American holdings. Would they not require a higher risk premium to lend more money to us? Would that not lead to higher mortgage rates?
