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To: Jim 726
"The subprime crisis was caused primarily by the crash of real estate values..."

IMO, real estate was and is overvalued relative to the rest of the economy.


10 posted on 06/08/2011 9:13:52 PM PDT by familyop (We Baby Boomers are croaking in a thunderous avalanche of rottenness heard across the universe.)
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To: familyop

“IMO, real estate was and is overvalued relative to the rest of the economy.”
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You are almost certainly right that it still is and it certainly has been in recent years. A few years ago some on FR were referring to spending five or six years gross income on a house as normal. It takes a lot of willful blindness to think that could be normal. I remember when the rule for most people was that a house should cost no more than two years annual income and that was based on a one income family. For a married couple to spend even two years income for both on a house is too much, to spend five years income for both is totally irresponsible, it is begging for disaster.


13 posted on 06/09/2011 5:40:49 AM PDT by RipSawyer (Trying to reason with a liberal is like teaching algebra to a tomcat.)
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