Quick recap for those of you joining us mid-program...
The so-called experts led by the NAR (National Association of (Lying) Realtors) and the liars in the MSM such as Larry Kudlow and Jim Cramer told us over and over that there was no housing bubble. Then they told us that OK maybe there is a teenie tiny bubble but it will never burst. Then when it burst they told us, yeah OK but it will be contained to subprime. Then when the whole mother effer collapsed they said yea but at least rents will go up since so many people will be renting.
And once again the so-called experts are proven wrong. Any 1st year econ student could tell you why they are wrong. The lesson is taught day 1. Supply and demand. When there are millions and millions of empty houses and condos on the market, prices for those millions and millions of housing units will drop. And they will drop whether the units are lived in by the primary owner or the units are rented out.
And what do you know, once again that old supply and demand curve is proven right again. Sorry NAR. Sorry Kudlow. Sorry Cramer. Better luck next time.
NEW YORK (CNNMoney.com) -- Home prices dropped last year in most cities around the nation, and now rents are flattening out in many of the markets worst hit by the housing downturn. According to data from Investment Instruments Corp. generated by their rentometer.com site and supplied the data exclusively to
CNNMoney, the median monthly rental bill for a sampling of 10 metro areas all around the United States rose just 0.5 percent in 2007 from $1,457 to $1,465."The major factors having an impact on housing prices are foreclosures, which make more rental property available," said Owen Johnson, president of Investment Instruments, "and also foreclosures that are not happening." In the latter case, according to Johnson, many speculators bought properties to "flip," selling them quickly in a rapidly appreciating market. In some Sun-Belt areas, investors bought condos and other properties while they were still in development, to sell when a
Of the 10 areas sampled by Rentometer, Atlanta and Houston rents declined the most, plunging 12.8 percent for the year. Median monthly rent for all rentals in Atlanta is now $884, and in Houston it's $779. Other cities reporting big declines included Washington (11.8 percent), Miami (9.0 percent) and Phoenix (7.3 percent).
Hmmm I think I have a phone call to my landlord to make asking for a 12% reduction in rent. If he says no, judging by a quick perusal on craigslist, I have a feeling some other desperate homedebtor will say yes. That's the great thing about now being tied down to a mortgage. Within 30 days I can move. Sure it costs a couple of bucks in moving costs, but I could move every month and would still spend less on movers than what the average homedebtor is losing every month on the value of his home.