Winnipesaukee Forum - View Single Post

secondcurve · 06-11-2007, 07:05 PM

In my opinion, prices in the near term will continue to behave well. Longer term, it's probably a downward trend.

I think the one thing real estate bulls are forgetting is that this "downturn" has been happening in an excellent macro environment. Specifically, interest rates are low (6% for a 30-year fixed, until just the past week), unemployment is non-existent (around 4.5% last month) and the stock market has been robust. Against this backdrop, it is surprising that there has been any downturn at all.

If any of the above variables change substantially there will be a significant real estate downturn. Remember, low interest rates inflate all asset classes, including real estate.

If you are in a position to buy, or need to buy, go ahead and make the purchase. On the other hand, if you are going to retire in 5-10 years, or are considering borrowing heavily to make your purchase, be patient as I am pretty sure there will be a better entry point. A second home area such as Winnipesaukee becomes very vunerable in a gut wrenching recession.

06-11-2007, 07:05 PM	#9
secondcurve Senior Member Join Date: Jan 2005 Posts: 2,117 Thanks: 1,325 Thanked 559 Times in 288 Posts	In my opinion, prices in the near term will continue to behave well. Longer term, it's probably a downward trend. I think the one thing real estate bulls are forgetting is that this "downturn" has been happening in an excellent macro environment. Specifically, interest rates are low (6% for a 30-year fixed, until just the past week), unemployment is non-existent (around 4.5% last month) and the stock market has been robust. Against this backdrop, it is surprising that there has been any downturn at all. If any of the above variables change substantially there will be a significant real estate downturn. Remember, low interest rates inflate all asset classes, including real estate. If you are in a position to buy, or need to buy, go ahead and make the purchase. On the other hand, if you are going to retire in 5-10 years, or are considering borrowing heavily to make your purchase, be patient as I am pretty sure there will be a better entry point. A second home area such as Winnipesaukee becomes very vunerable in a gut wrenching recession.