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osubucks30
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I believe home prices should continue to fall and stay flat for YEARS. America is becoming unaffordable.

Link to chat showing average wage vs average home prices:

http://www.forbes.com/2007/06/26/wages-home-prices-biz-cx_de_dream0607_0626graph .html?partner=rss

SEE A PROBLEM???

Posts: 1458 | From: Ohio | Registered: Mar 2004  |  IP: Logged | Report this post to a Moderator
turbokid
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i'd like to see the same thing overlayed with heating and gasoline prices.

so, was it the "predatory lenders" loaning money to folks who couldnt pay it back, or were people forced to buy houses they couldnt afford because, well EVERY house is unaffordable?

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"Gentleman, you have come sixty days too late. The depression is over."
Herbert Hoover 1930

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PCola77
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turbo kid, it's somewhat of a chicken/egg argument, but I'd defintely say that the lending practices were a huge boost to home prices, if not an outright cause. Think of it this way:

Why do home prices rise? Because demand exceeds supply. How does demand increase so drastically for so long? Because people are able to access more and more money, more and more easily. If lendign practices has been "normal" over the last 15 years, prices would not have even approached the point that they reached recently, in my opinion. You would not have seen people buying hoses to flip them if they had to put 20% down, or if they couldn't get interest only loans, or 120% of value loans, etc.

quote:
Originally posted by turbokid:
i'd like to see the same thing overlayed with heating and gasoline prices.

so, was it the "predatory lenders" loaning money to folks who couldnt pay it back, or were people forced to buy houses they couldnt afford because, well EVERY house is unaffordable?


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Propertymanager
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After a real estate bust, it typically takes 8-10 years for inflation adjusted prices to reach their previous highs. Considering that this was the biggest real estate boom in history, we might expect that the bust will also be prolonged.

Mike

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IMAKEMONEY
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BUYING OP!!

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LIFE IS 10% HOW YOU MAKE IT AND 90% HOW YOU TAKE IT!

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glassman
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quote:
Originally posted by turbokid:
i'd like to see the same thing overlayed with heating and gasoline prices.

so, was it the "predatory lenders" loaning money to folks who couldnt pay it back, or were people forced to buy houses they couldnt afford because, well EVERY house is unaffordable?

i tend to agree with your theory TK...

why are houses unaffordable? because the money was too easy to get.

college tuitions have become the same.

College tuition still rising
Report: Average increase of 6.6 percent forcing students to borrow more


updated 10:16 a.m. CT, Mon., Oct. 22, 2007

Average tuition and fees at four-year public colleges rose 6.6 percent this year, again outstripping increases in financial aid and pushing students into more borrowing. Community colleges once again did the best job keeping the lid on prices.

In-state students at four-year public schools are paying $6,185 this year, up $381 from last year, according to the nonprofit College Board's annual survey of college costs, released Monday. At four-year private colleges, tuition and fees rose 6.3 percent to $23,712.

The published price is not the real price for many students. On average, accounting for grants and tax breaks, full-time students are actually paying $2,577 this year to attend four-year public universities. That's $209 more than last year.


http://www.msnbc.msn.com/id/21420361/

the availability of easy to get cheap student loans allowed the Universities to raise prices at an unreasonable rate for years.

in-state tuition for me at a 40,000 student state university in the late 70's was under 1000$ per year full time and in the early 80's it was 1300$.

student loans were pretty much unheard of, and scholarships went primarily to (male) football and basssetball players..

today? scholarships and grants are given out for just getting a good score on the ACT/SAT...

i'm not complaining about this, but that money is coming from somewhere.

my research indicates it's 90% federal money.

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Don't envy the happiness of those who live in a fool's paradise.

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