Zeev's Turnips Patch-No Politics (ZEEV)

[TJ Parker]

greenspan comes clean re RE:

In response to a question about soaring house prices, Greenspan conceded that in some areas prices have outstripped growth in incomes and rents. "This observation raises thew possibility that real estate prices, at least in some markets, could be out of alignment with the fundamentals."

Concern has been expressed in Congress and elsewhere that home prices in some metropolitan areas have shot up at such a pace that they constitute a "bubble," which could burst to the detriment of owners and the broader economy.

Greenspan cautioned that, after a period of very low mortgage rates, it was hard to get a clear measure of home-price rises, but policy-makers were watching the issue.

"As is the case with other asset prices, we monitor real estate prices closely in developing our economic outlook," he said.

http://www.reuters.com/newsArticle.jhtml;jsessionid=W4MJWHHN021WUCRBAEZSFEY?type=businessNews&st...