Tuesday, December 25, 2012

3 of top 9 reasons the real estate bubble

If you own a property or are thinking about buying a property then you better be paying attention, because this could be the most important Letter You received this year regarding real estate and your financial future.

The last five years have seen tremendous growth in the real estate market and, as a result, many people believe that real estate is the safest investment you can make. Well, it is no longer in effect. Real estate prices have risen rapidly in the real estate market at a price level never seen in history when adjusted for inflation! This means more and more people are concerned about the real estate bubble real estate buyers are available below. Means fewer buyers that price down.

And Federal Reserve Governor Susan Bliss on May 4, 2006, the "housing has really kind of peaked." This comes in the wake of the new Federal Reserve Chairman Ben Bernanke said he was worried that "soften" the real estate market would hurt the economy. Description of the Chairman of the Federal Reserve Alan Greenspan has in the real estate market as slaves. All agree that senior financial experts that there is already a viable in the market, there is obviously a need to know the reason behind this change.

3 main causes of 9 who will burst real estate bubble, including the following:

1. interest rates rise – foreclosure 72%!

2. first-time homebuyers out of the market price – the real estate market and the collapse of the base of the pyramid

3. the market psychology has changed so that now people are afraid of the bubble burst – property mania more!

The first reason is the real estate bubble burst up the flowers. Under Alan Greenspan, interest rates are at historic lows from June 2003 to June 2004. This low interest rates allowed people to buy homes more expensive then what they can afford, usually at the same monthly cost, essentially creating a "free money". However, over time, lower interest rates, as interest rates soared, and will continue to increase. Interest rates must rise to fight inflation, partly because of higher gasoline and food costs. High interest rates make home ownership more expensive, thus reducing the value of the home.
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