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THE LOOMING HOUSING CRASH IS HAPPENING
Dean Baker of the Center for Economic and Policy Research says that if housing prices fall at least 10%, it could be even more damaging than the collapse of the high-tech stock bubble in 2000 .
Are you ready for this ?
43% of first time homeowners last year put no money down on their purchase and the housing market is definitely cooling off .
Don't think Wall Street is not aware of this. The Dow was down over 200 points today and it wasn't just because oil hit 69 dollars a barrel ~
The looming housing crash of 2006/07 will coincide with rising interest rates, rising oil prices and rising bankruptcies. That's what happens when you owe more than your home is worth ~ and you probably have a second mortgage on it.
The great mirage of the Bush easy money/ high debts economic recovery will soon be evident and felt by all ~ and Noelle Knox, USA Today, spells out the consequences.
Allen L Roland
43% OF FIRST TIME HOMEOWNERS LAST YEAR PUT NO MONEY DOWN
http://www.usatoday.com/money/perfi/housing/2006-01-17-real-estate-usat_x.htm?csp=34
NOELLE KNOX, USA TODAY - As housing prices soared last year, an eye-popping 43% of first-time home buyers purchased their homes with no-money-down loans, according to a study released Tuesday by the National Association of Realtors. The trend is potentially ominous. The real estate market is cooling in some areas, and rates on adjustable-rate loans are creeping up.
As a result, some no-money-down buyers could owe more than their homes are worth.
The median first-time home buyer scraped together a down payment of only 2% on a $150,000 home in 2005, the NAR found. Already, home prices in many areas are declining, and the "For Sale" signs are hanging in front yards longer.
There's now at least a 50% risk that prices will decline within two years in 11 major metro areas, including San Diego; Boston; Long Island, N.Y.; Los Angeles; and San Francisco, according to PMI Mortgage Insurance's latest U.S. Market Risk Index. . .
Dean Baker of the Center for Economic and Policy Research says that if housing prices fall at least 10%, it could be even more damaging than the collapse of the high-tech stock bubble in 2000. . . Baker and other economists are concerned that many lenders have pushed a series of creative but potentially dangerous loans to help more Americans afford a home.
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TRUTHTALK
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