Steve, We'll just have to see how it all pans out. We're probably talking about 10 years. The real key here is to make sure that it doesn't happen to us.
I know that banks hate owning real estate because it means that one of their assets didn't perform and they incurred all the cost and hassle and they don't profit from all that interest over the next 15 or 30 years. I just think that the cascade of foreclosures will force a paradigm shift in the industry. The banks themselves may not hold the property. It could just be the pass-through. I think the end result is going to be the same regardless of whose name is on the deed: the name on the deeds will be one of a few corporations instead of lots of individual citizens. Or, again, the likely scenario of government intervention will end with the government owning a big chunk of the housing and telling people where to live because the people won't be able to scrape up enough to buy again.
Funny you mention Texas. I have bought and sold two homes in Texas and it is a bigger pain in the ass there than any other state in which I have lived. Texas just voted to allow home equity loans in the past few years. Before that, you couldn't get one. All of it is a hangover from the housing/mortgage crash that happpened there. Title insurance is a big deal in Texas, much more so than in most other states because they don't want previous owners or heirs of such showing up and pointing out any technicalities from a twenty-year-old foreclosure.
I think the one thing that we can agree on is that it's probably going to get ugly as people keep driving themselves further into debt. The rest is really just details that I am speculating on. Now the markets open. Let's see if the NDX looks to retest the 200sma, currently around 1402.
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