Anyone remember powayseller?

[Zeitgeist]

We are not at the bottom in all areas and any massive instability whether geopolitical, monetary or nature made disaster could easily reverse the trend. PS based her theory on previous factors. The massive bailouts changed the equation.

[sd_owner]

Powayseller made the right call indeed. What she (and many of us) did not expect was that the fed would take such great pains to prop up the housing market. Therefore, the magnitude of the decline has been much less than she predicted.

She is making the correct call again this time. At this time, it is fairly safe to say that, in terms of nominal home prices (i.e., before taking inflation into consideration), the downside risk is much smaller than the upside. The biggest risk is inflation. When that comes, asset (including homes) prices will start shooting up again.

[sd_owner]

Powayseller made the right call indeed. What she (and many of us) did not expect was that the fed would take such great pains to prop up the housing market. Therefore, the magnitude of the decline has been much less than she predicted.

She is making the correct call again this time. At this time, it is fairly safe to say that, in terms of nominal home prices (i.e., before taking inflation into consideration), the downside risk is much smaller than the upside. The biggest risk is inflation. When that comes, asset (including homes) prices will start shooting up again.

[sd_owner]

Powayseller made the right call indeed. What she (and many of us) did not expect was that the fed would take such great pains to prop up the housing market. Therefore, the magnitude of the decline has been much less than she predicted.

She is making the correct call again this time. At this time, it is fairly safe to say that, in terms of nominal home prices (i.e., before taking inflation into consideration), the downside risk is much smaller than the upside. The biggest risk is inflation. When that comes, asset (including homes) prices will start shooting up again.

[sd_owner]

Powayseller made the right call indeed. What she (and many of us) did not expect was that the fed would take such great pains to prop up the housing market. Therefore, the magnitude of the decline has been much less than she predicted.

She is making the correct call again this time. At this time, it is fairly safe to say that, in terms of nominal home prices (i.e., before taking inflation into consideration), the downside risk is much smaller than the upside. The biggest risk is inflation. When that comes, asset (including homes) prices will start shooting up again.

[sd_owner]

Powayseller made the right call indeed. What she (and many of us) did not expect was that the fed would take such great pains to prop up the housing market. Therefore, the magnitude of the decline has been much less than she predicted.

She is making the correct call again this time. At this time, it is fairly safe to say that, in terms of nominal home prices (i.e., before taking inflation into consideration), the downside risk is much smaller than the upside. The biggest risk is inflation. When that comes, asset (including homes) prices will start shooting up again.

[(former)FormerSanDiegan]

[quote=deadzone]

If any of you really belive this is over, or that the high-end won’t get hit, do you realize the Option ARM and Alt-A resets are due to hit in mass in 2010-2012? What % of these mortages do you think really got adjusted to fixed? How many of those adjusted will still go into default anyway? What more ammunition does the gov have to fend off this next foreclosure wave? Hard to lower interest rates any more than 0%.[/quote]

I agree that Option ARMS are toast.
But your typical Alt-A 5/1 ARMs are currently resetting to levels at or below their initial rate. In fact, the LIBOR would have to jump by nearly 3 percentage points from topday’s rates for the typical alt-A 5/1 ARMs to reset above 6%.

[(former)FormerSanDiegan]

[quote=deadzone]

If any of you really belive this is over, or that the high-end won’t get hit, do you realize the Option ARM and Alt-A resets are due to hit in mass in 2010-2012? What % of these mortages do you think really got adjusted to fixed? How many of those adjusted will still go into default anyway? What more ammunition does the gov have to fend off this next foreclosure wave? Hard to lower interest rates any more than 0%.[/quote]

I agree that Option ARMS are toast.
But your typical Alt-A 5/1 ARMs are currently resetting to levels at or below their initial rate. In fact, the LIBOR would have to jump by nearly 3 percentage points from topday’s rates for the typical alt-A 5/1 ARMs to reset above 6%.

[(former)FormerSanDiegan]

[quote=deadzone]

If any of you really belive this is over, or that the high-end won’t get hit, do you realize the Option ARM and Alt-A resets are due to hit in mass in 2010-2012? What % of these mortages do you think really got adjusted to fixed? How many of those adjusted will still go into default anyway? What more ammunition does the gov have to fend off this next foreclosure wave? Hard to lower interest rates any more than 0%.[/quote]

I agree that Option ARMS are toast.
But your typical Alt-A 5/1 ARMs are currently resetting to levels at or below their initial rate. In fact, the LIBOR would have to jump by nearly 3 percentage points from topday’s rates for the typical alt-A 5/1 ARMs to reset above 6%.

[(former)FormerSanDiegan]

[quote=deadzone]

If any of you really belive this is over, or that the high-end won’t get hit, do you realize the Option ARM and Alt-A resets are due to hit in mass in 2010-2012? What % of these mortages do you think really got adjusted to fixed? How many of those adjusted will still go into default anyway? What more ammunition does the gov have to fend off this next foreclosure wave? Hard to lower interest rates any more than 0%.[/quote]

I agree that Option ARMS are toast.
But your typical Alt-A 5/1 ARMs are currently resetting to levels at or below their initial rate. In fact, the LIBOR would have to jump by nearly 3 percentage points from topday’s rates for the typical alt-A 5/1 ARMs to reset above 6%.

[(former)FormerSanDiegan]

[quote=deadzone]

If any of you really belive this is over, or that the high-end won’t get hit, do you realize the Option ARM and Alt-A resets are due to hit in mass in 2010-2012? What % of these mortages do you think really got adjusted to fixed? How many of those adjusted will still go into default anyway? What more ammunition does the gov have to fend off this next foreclosure wave? Hard to lower interest rates any more than 0%.[/quote]

I agree that Option ARMS are toast.
But your typical Alt-A 5/1 ARMs are currently resetting to levels at or below their initial rate. In fact, the LIBOR would have to jump by nearly 3 percentage points from topday’s rates for the typical alt-A 5/1 ARMs to reset above 6%.

[Anonymous]

Are you suggesting that the Alt-As won’t “recast” like the Option ARMs? Because when the reset hits, it’s not just the interest rate. Nearly all of these borrorers are now well under water (See WSJ front page today). This means due to their decreasing LTV, monthly payment will still go up regardless of interest rate.

[Anonymous]

Are you suggesting that the Alt-As won’t “recast” like the Option ARMs? Because when the reset hits, it’s not just the interest rate. Nearly all of these borrorers are now well under water (See WSJ front page today). This means due to their decreasing LTV, monthly payment will still go up regardless of interest rate.

[Anonymous]

Are you suggesting that the Alt-As won’t “recast” like the Option ARMs? Because when the reset hits, it’s not just the interest rate. Nearly all of these borrorers are now well under water (See WSJ front page today). This means due to their decreasing LTV, monthly payment will still go up regardless of interest rate.

[Anonymous]

Are you suggesting that the Alt-As won’t “recast” like the Option ARMs? Because when the reset hits, it’s not just the interest rate. Nearly all of these borrorers are now well under water (See WSJ front page today). This means due to their decreasing LTV, monthly payment will still go up regardless of interest rate.

[Author]

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