Posted on 05/18/2006 7:34:39 PM PDT by doc30
NEW YORK (Reuters) - Former Federal Reserve Chairman Alan Greenspan said on Thursday that the "extraordinary" boom in the U.S. housing market in recent years is over.
"This has been quite an extraordinary boom," Greenspan told a Bond Market Association dinner in New York. "The boom is over. I think we can safely say that with a strong degree of confidence."
Greenspan said there was a "high degree of froth in the system," and that it was clear that home equity extraction and the turnover of home sales was waning.
(Excerpt) Read more at today.reuters.com ...
Aren't they owned by Saudi Arabian interests that are heavily invested in tents anyway?
His judgement? What about HERS!
Big boom
Well, he used to have extraordinary access to the relevant information - probably one of the best positions to get a big picture. Does not mean that he gets it right, but does mean that he's [or used to be] better informed than almost all.
Well, he sure picked a fine time to learn how to speak english...
The US says Greenspan's relevance is over.
Duh, yeah Greenie. After the fed jacked rates how many times in a row, you're darn right the bloom is off.
Then I guess we better send the alien construction workers back home because there won't be enough homes for them and also citizen construction workers to build.
This might be helpful ?
http://www.freerepublic.com/focus/f-news/1111944/posts
Does this mean my 4 year old house won't tripple again in value in the next 3 years like it did in the last 3 years?
Don't know, but I can tell you that our market in Va is bust, house for-sale ads have gone from 2 pages to 4 pages in local Sunday paper.
I'm just hoping mine doesn't go back down to what I paid for it!
susie
thanks
Happily, Greenspan is over. What a doofus!
Yup, that's exactly what it means.
There's only so many houses people can buy -- and at a price they can afford. Housing doesn't always go up -- just like stocks don't always go up. But there is always something going up, and something going down -- causing people to adapt.
That's what they call market forces. Some people think all one has to do is pass laws to regulate prices and they can ignore market forces.
So in places like Hawaii, they pass gas cap laws and prices go up -- and so they remove them and wonder why prices aren't going down. It's because price caps don't control prices -- market forces do. They have to adapt and reduce their demand to cause prices to adapt to the new demand. It's because gas price caps don't work that it doesn't matter whether they're in force or not.
They have to change the demand, which is adapting to the market -- and not passing laws demanding the market sells them unlimited gas at the price they want to pay.
filing
Every time that guy opens his trap the stock market tanks. I thought we were done with him when he retired.
When all us baby boomers leave the scene, there will be a huge glut of houses.
Again?
I don't know about that.
But another triple in three years seems improbable.
It reminds me of the period in the early '80s when commodity prices peaked -- gold, oil, real estate, but instead of the whole economy crashing like they frequently write about, there is a shift into other markets and assets -- at that time, it was the beginning of the great bull market in stocks that began in 1982.
As for a glut of housing, I don't think the markets get that far out of line. Usually what happens is that people move from high cost areas to lower cost areas. Supposedly, that's Texas right now, and the adjoining areas.
The coasts and the cities may be overpriced and driving migration to other communities, and stories I've read, is people are wondering why they hadn't done it sooner -- as their lives invariably improve.
Those who adapt, thrive and flourish; those who won't, complain all the louder.
"GreenSpam" just can't keep his mouth shut either.
Hi Porterville,
I don't know if you live in Porterville CA. I live in Bakersfield about 65 miles from there. They're still building houses at an unbelievable rate here. It seems the boom may be settling down, but showing no signs of bust here.
I suspect our boom was do to newcomers from the higher priced areas of CA. They have driven up our values, but we are still cheaper than a lot of areas elsewhere in CA.
"Don't know, but I can tell you that our market in Va is bust, house for-sale ads have gone from 2 pages to 4 pages in local Sunday paper."
How many pages are the foreclosure notices now?
I think the fed rate has been raised sixteen or seventeen straight times now. That same couple living in an apartment and considering purchasing a home is probably going to stay put to ensure they can have a more substantial downpayment. Why would the government wish to discourage home ownership like that?
The reasons given for continually raising the rates don't make sense to me...
~ Blue Jays ~
I can afford a crash. It might even help my kids buy homes. Over 10 years, my equity will come back, if I lose much at all. My youngest daughter and her husband have $25K in the bank and fairly decent jobs, but they feel priced out of the market right now.
I forgot, they would have to put up with 25 Mexicans living next door in the 1 bedroom house with ten cars in front of the house.
Nobody can afford a crash. If/when real estate goes it'll hit Wall Street, which has been packaging mortgages as investments, like a tidal wave. It will hurt every single ancillary company that services the building trades, from lumber to toilets. Then it'll echo through the rest of the economy.
ROTFLMAO!
Thank God.
It's called the Clinton Syndrome.
Yeah, right!! come on over here to Maui and tell us that. Try to buy a house here. The lots are more than houses are in other areas.
Kinda like a case of Herpes I suppose.
An appropriate analogy for sure!
How many of those are second/vacation homes?
my home has increased 700% since we bought it 22 years ago. I am just amazed.
My sister laughed at me when we bought our home for less than 100k. She told me we overpaid for it then.
I don't know much about real estate in Hawaii, but I've seen it crash here in NYC. It always happens the same way -- in slow motion. Folks think it happens like a crash on the commodity markets or Wall Street, but the truth is, it can take 6 months to a year before the downward momentum accelerates enough to become noticeable.
Opportunity...buyers market.
Northeast, Kalifornia, Florida.
In Oklahoma, for example, prices have only risen about 5% annually. And that only in the larger metropolitan areas, viz., Tulsa.
I wouldn't expect to see huge market adjustments in these areas.
Hey Lou - do you think the areas, such as OK, that are not over-inflated will see a rise in sales from people moving away from overpriced regions?
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