[ex-Texan]

I am recommending you go out tomorrow and buy this tiny 400 sq. foot cottage in Provencetown, MA. Keep telling yourself there is 'no bubble.' This beautiful house was listed for sale at $600,000. Just think: If you beat the seller down on his price by $ 100k, you may be able to pay cash for a brand new GMC automobile. And pay off all your credit cards. Yada, yada, yada.

[PittsburghAfterDark]

The one problem that I know is inflating housing prices are interest only mortgages.

Yeah, okay, great, you now have a $500,000 home that you can mortgage for $1,500 a month. You never build up equity. You never own anything. You're making a rent payment. You're floating your variable interest rates on LIBOR instead of prime. You still have to refinance or face a balloon payment in 10-15 years that you can never pay.

Interest only mortgages are what's driving ever rising housing prices. This is true in most "hot" housing markets where they are 33-50+% of financing in the DMA.

This is a bubble, no ifs ands or buts about it.

Liquidity is the key to financial well being. Interest only mortgages allowing you to have a home above your means is a recipie for disaster.

[investigateworld]

Being in the construction biz I watch the rents to price ratio closely as it's been for me the most accurate indicator. It's starting to climb in Portland Metro, so I predict we'll see a 'market adjustment' before the other states.

We are not immune here as the largest single "group" of buyers are from out of state.

Incomes alone in Oregon cannot support these price increases. But I'll be working my business till the fit sits the fan. I've been to this rodeo a couple of times before. Ain't* no biggie.

*With apologies to Miss Barnett my 8th grade English teacher.

[Cedric]

I just sold a stock {EPIX} which was us 15% in less than one hour this morning. Too much, too fast. Wrong! At the high {so far} it was up 26%!!

You can only see tops in the rear view mirror.

P.S. I've been trying to talk it down {so I can get back in} for the last hour, but to no avail. It's still way above where I sold it.

P.S.S. Oh, wait, It just spiked down. Looks like the party's over. Now I don't want to buy any more!!!!

[1234]

"...recommending you go out tomorrow and buy this tiny 400 sq. foot cottage in Provencetown, MA. "

am drooling, 'cept what's acreage?

[nopardons]

P.Town is a RESORT/SECOND HOME area. It's also been an "artsy-fartsy"/ homosexual camp, for 100 years on. Housing in such areas ( resort/SECOND HOME )have gone had heady price escalations for almost those 100 years. You might want to call it a "BUBBLE", but it has almost NO bearing on the housing costs in other areas; NONE!

[Dr. Frank fan]

I am recommending you go out tomorrow and buy this tiny 400 sq. foot cottage in Provencetown, MA. Keep telling yourself there is 'no bubble.'

Uh, for the record may I point out that I took no position whatsoever on whether or not there's a "bubble" (whatever that means). I am entirely agnostic on the subject. The point I stated (quite clearly I might add) in my post was not that "there's no bubble" (I have no idea!) but that it's not worth discussing.

Please, tell me why it's worth discussing?

If you believe there's a "bubble", well yippee for you! I certainly won't argue with you. All I'm saying is to put your money where your mouth is by making economic decisions that pay off or at least hedge, in a "bubble" scenario. Just, why the jibber-jabbering about it to the rest of us? What's it accomplish?

[BJungNan]

Houses go cheap in your neighborhood. That was only $600,000?