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Author Topic: The Subprime Market, Bubbles, and How Housing Works  (Read 413 times)

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Offline MichaelSolimanto

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The Subprime Market, Bubbles, and How Housing Works
« on: March 31, 2007, 02:46:17 AM »
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    • Bubbles are regional, not national. If you own a house chances are the area you bought it in will determine if you are in a bubble. Texas and the Mid-West is not a bubble region. Appreciation didn't escalate and become insane.

    If you owned a house in Houston 5 years ago chance are it didn't double or triple in value. Now when the ARMs (Adjustable Rate Mortgage) kicks in at a higher % rate you can sell without too much fear of a flood of houses that just aren't selling.

    Similarly there are areas that are still appreciating and selling at great mark-ups even to this day. Increases in jobs to a certain area is the #1 reason why this is going to happen.

    Is there going to be a "Greater Depression"? Yes, but not for a short while.
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    Michael Solimanto

    Offline MichaelSolimanto

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    The Subprime Market, Bubbles, and How Housing Works
    « Reply #1 on: April 01, 2007, 01:45:06 AM »
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    • Let me also add that the bubbles of San Diego, NYC area, Miami, etc. are only indicative of their over appreciated value correcting itself. The bubble burst because of over inflation.

    My example was to point out areas like TX will not depreciate at all in the coming years, while states like FL, CA and NY will have problems in most major metro areas.
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