Discussion in 'General Appraisal Discussion' started by Serge Paquette, Nov 28, 2003.
The seven deadly sins - Article from The Economist
Good article. I recently completed an appraisal where the value was lower than the previous year's appraisal. The young 20-something LO asked me how that could be. When I told her that prices in that area had dropped slightly over the past year, she looked shocked. She said she had no idea that home values could go down! She actually thought they ALWAYS went up. :blink:
I agree with everything that article says except where it makes a comparison between American spending habits and Japanese which are profoundly two different cultures. When Japan got economical crises and its government supplied easy money to the public by lowering the interest rate almost to Zero hopping that people would spend the money in shopping centers or invest in new busineses, it didn’t happened. Japanese got the money but didn’t spend or invest it. They put the money under the mattress or saved it back in the bank although with a very little interest rate. That is the way Japanese reacted to easy money. American on the other hand, are good spenders and if they get more money, they will spend more and that is what Greenspan is hoping for.
Good point Moh. :lol:
Interesting article. Prices here have gone up at 20%+ per year rates for quite a while. Amazing really. We'll see what happens in the future, but housing affordability is even more of an issue than it was before. It can't go on indefinitely. <_<