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June 28, 2005
Biggest bubble in history?
I've been reading this thread at FatWallet.com where people are discussing if a housing bubble exists or not. We don't think we can afford a house living in the San Francisco Bay Area unless we want to commute about an hour to work every day. The houses in Mountain View, California start at about $650,000 for two bed/one bath 90 year-old, 1000 sq ft houses on 5,000 sq ft lots. It's crazy.
Anyway, I found this article at The Economist, where it states,
The worldwide rise in house prices is the biggest bubble in history. Prepare for the economic pain when it pops.It's a good read if you're interested not just in what's going on in the U.S. but the entire world with regard to the housing price explosion.
Another interesting piece over at Yahoo! Finance called "The Mortgage Trap" is on the lender practice of continuing to lower loan standards. The article says "interest-only" loans make up 20% of all new mortgages, though I read in the San Jose Mercury News a couple of months ago that it was as high as 50% of all new mortgages in California.
Posted by brian at June 28, 2005 09:21 AM