February 11, 2008
Perhaps I am too cautious. However, it seems to me that the foreclosure crisis started when the price of a house rose to ridiculous amounts. The houses in my area are out of my price range. I rent. I have to rent. The townhomes in my area are over $400,000 and there is no way I can afford that. The folks who did buy, who were encouraged to buy, who were literally told it was a fiscally great idea to buy, did so on the assurance that the market would continue to go up and up and up. At some point, folks, the sky will fall and that is just what happened. Folks scrimped, gathered money from all sorts of places, went together with other families to live in the same house so they could afford the houses which continued to drive up the market. Now that the mortgage rate for the 30 year is dropping, we are seeing the same pressure to buy, buy, buy. And I am keeping my checkbook closed because the price of housing still isn't going down enough for me to risk taking on a mortgage in this economic climate.