Meanwhile, speaking of housing, there are a lot of long faces among house sellers this morning. According to the weekend news, the story just becomes more and more depressing.
“American Dream turns to a Nightmare,” begins the report in the Arizona press. (A modest suggestion to financial journalists: find a better headline. We’ve read that same headline at least 20 times already. This downturn in the housing threatens to last for years. You can’t keep using that same line. Please try to think of something new.)
The Phoenix market was so hot it attracted buyers from all over the country. Now, the buyers have disappeared. Houses are empty. Foreclosures are rising. Who could have guessed that it would turn out this way? Well, anyone who bothered to think about it…but apparently none of the thousands of people who bought houses did! According to the report, people bought houses in 2006 for US$250,000…fully expecting that their places would be worth US$500,000 in five years. Prices were rising steeply; they couldn’t imagine that it would ever stop.