Thursday, September 29, 2005

Freddie Mac CEO: High-End Housing Bubble Will Burst

The CEO of Freddie Mac now admits that there is a real estate bubble in many parts of the country but the bubble is limited to "high-end" housing. And what's more, this bubble will "soon burst". Not deflate, not come in for a so-called "soft landing", but burst.

What isn't "high-end" these days? And isn't pretty much ALL of Marin "high-end" housing?

Some choice quotes:
[Richard F. Syron, Chairman and Chief Executive of Freddie Mac, said] "...the recent spike in high-end housing prices in places such as metropolitan Boston, New York City and in California constitute a bubble that will soon burst."

"He did not offer a specific forecast on how far prices in those markets could decline. But he said the drop could be big enough to affect the overall economy as owners of pricey homes see their property values decline and become reluctant to spend on other items, like cars."

""Even a modest downturn in housing would be felt throughout the economy," he said."

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