Zeev's Turnips Patch-No Politics (ZEEV)

[augieboo]

"I think Real estate is in a bubble right now. Sure we are not going to see 75% declines like the stock bubble but 20% declines will be just as much and even more painful to the economy."

I think that's more than a bit doom&gloomish.

Sure, real estate is in a bubble-like situation in various areas of the country. But you can still buy most of the middle 3/4 of the country at prices those of us on the coasts would consider dirt cheap.

Second, when a RE bubble bursts it has nowhere near the comprehensive effect that the stock bubble bursting has had. I know, because here in N. California we have another RE bubble about every ten to twelve years. So long as you can make your mortgage payments it doesn't really matter in the short term how much paper value your house loses -- it's still shelter, and, worse comes to worst you can always raise chickens in the garage and grow veggies in the yard. {g}

Sure, if you can't make your payments then you are farked, but whether you can make the payment or not is independent of the paper value of the home.

JMDO, etc.