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I am NOT an economist... Posted by PGAero [Email] (#1143) [Profile/Gallery] (more from PGAero) on Fri, 15 Dec 2006 12:36:53 In Reply to: Economics question -- housing market, vvk, Fri, 15 Dec 2006 12:17:00 Members do not see ads below this line. - Help Keep This Site Online - Signup |
And I don't even play one on TV. (I am an Engineer.)
Here's my thought. Houses are worth what people are willing (and able) to pay for them. The fact that the housing market is slowing reflects that people are less able to purchase houses... if they are less able to purchase houses, they have less discretionary income.
If people could afford houses this year the exact same way they could last year, house values would not be coming down.
Can any people who know what they are talking about confirm this?
I guess I saw it differently: house prices are falling because people can't afford them. You saw it: house prices are down, so people will be able to buy more stuff since they aren't spending as much on their house. (Just because your house is worth $20,000 less, doesn't mean that your house payment goes down...)
~Peter
'93 Aero 5spd.
posted by 75.26.180...
_______________________________________ Current: '03 9-5 Aero Wagon, 5spd, Polar/Black Past: '06 9-5 Combi, AT, Polar/Black '04 9-5 Aero Wagon, AT, Nocturne/Granite '03 9-5 Aero Wagon, AT, Steel/Charcoal '00 9-3 Viggen, 5D, Silver/Black '93 9000 Aero, 5MT, Cirrus/Black (Owned this one twice) '86 900 SPG, 5MT, Edwardian/Buffalo Grey
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