Housing – Madness, Denial and Regrets

Madness – US Confidence Plunges to a Record Low. Consumers aren’t confident about the future. What, they are surprised that real estate prices can’t rise forever? They’re surprised that interest rates on their adjustable-rate mortgage went up? Where have they been? What were they thinking? Madness of the crowd convinced them that there is no history worth reading.

Denial – No matter how bad things look, there’s always a bright spot. As in the article linked above…

S&P noted one bright spot as the acceleration in decline was only moderate in August from July.

Amazing.

Regrets – I regret that I bought the home in which I currently reside, purchased before things got ridiculous, instead of one way over what I could afford, because it looks like people who signed up for liar’s loans may well get bailed out and be allowed to stay in the homes they couldn’t afford. If that happens, how will you feel about paying part of that mortgage payment? That’s what you’ll be doing.

Posted in Economy, Housing Bubble
Tags: Depression, Economy, housing, Housing Bubble, real estate

As the Housing Market Collapes, Neighborhoods Become “Ghost Towns”

As Michael Panzer points out at Financial Armageddon today, Jim Kunstler writes about a distopia where the suburbs are abandoned and become the new slums. Peak Oil and the housing bust feed on the final, inevitable collapse of the great American suburban experiment.

Interesting piece by Alex Roth of the Wall Street Journal about how half-built suburban developments strand early buyers in “post-calamity” like communities.

It’s a serious situation that will be worse before it gets better.

Posted in Economy, Housing Bubble
Tags: Depression, Economy, housing, Housing Bubble, Peak Oil, Recession

Ghost towns

California’s Inland Empire communities “ghost towns” in increasing numbers, says analyst in the LA Times Blogs.

This situation isn’t confined to California, however. Developers in a number of American cities are cutting prices of new construction to the bone, offering incentives (like Porches in the garage) and in all probability, begging people to take properties off their hands.

But mark my words. Panic hasn’t even set in yet.

Posted in Economy, Housing Bubble
Tags: Depression, foreclosure, housing, Housing Bubble, real estate