01-18-2009, 12:05 PM
Those landlords raising rents was in response to the values going up. If they didn't raise rents, the only sensible option would be to sell, right? I guess we've seen both happen.
I don't think anyone has any benefit from judging someone else on this board. This is just a forum of ideas. I came to this board to get answers to local issues that I have no clue about. There are a number of PW contributors who have a whole wealth of great idea. On this really important issue, it keeps coming back to alot of folks rushing into the market (not anyone in particular) and driving prices up, in a sort of "don't miss the boat" panic, people not realizing that they couldn't hang on when the boat starts to sink.
There is another culprit that I want to mention, because I thought about this many times starting about 7 years ago when things were starting to boom on the mainland: the Fed (Alan Greenspan at the time, now Bernanke) has toyed with our finances by adjusting the Fed fund rate to accomplish whatever it's own agenda is. Greenspan kept the interest rates too low for too long, and it fueled the housing bubble. Say, for someone with a $1500/mo. budget, it would have been better for them to get a house at $200k with a 7.5% mortgage in 2004, rather than the same house inflated to $300k, which they bought with a 5.5% mortgage. Problem is . . . 4-5 years later, they still owe $290k, and they are at the mercy of interest rates going up or whatever. Had the Fed gently raised interest rates to slow the 'boom', prices would have stabilized much earlier, interest rates would have been higher, people's monthly payment would still be the same for the same house,but they wouldn't be carrying so much debt. Hmmm ...
And now Greenspan's replacement, Bernanke, is the one testifying that we need to do all these bailouts, NONE of which has helped any of us.
What these guys are doing at the federal level is something that individually, none of us can really influence.
I don't think anyone has any benefit from judging someone else on this board. This is just a forum of ideas. I came to this board to get answers to local issues that I have no clue about. There are a number of PW contributors who have a whole wealth of great idea. On this really important issue, it keeps coming back to alot of folks rushing into the market (not anyone in particular) and driving prices up, in a sort of "don't miss the boat" panic, people not realizing that they couldn't hang on when the boat starts to sink.
There is another culprit that I want to mention, because I thought about this many times starting about 7 years ago when things were starting to boom on the mainland: the Fed (Alan Greenspan at the time, now Bernanke) has toyed with our finances by adjusting the Fed fund rate to accomplish whatever it's own agenda is. Greenspan kept the interest rates too low for too long, and it fueled the housing bubble. Say, for someone with a $1500/mo. budget, it would have been better for them to get a house at $200k with a 7.5% mortgage in 2004, rather than the same house inflated to $300k, which they bought with a 5.5% mortgage. Problem is . . . 4-5 years later, they still owe $290k, and they are at the mercy of interest rates going up or whatever. Had the Fed gently raised interest rates to slow the 'boom', prices would have stabilized much earlier, interest rates would have been higher, people's monthly payment would still be the same for the same house,but they wouldn't be carrying so much debt. Hmmm ...
And now Greenspan's replacement, Bernanke, is the one testifying that we need to do all these bailouts, NONE of which has helped any of us.
What these guys are doing at the federal level is something that individually, none of us can really influence.