# What's your prediction for the housing market?



## SeniorBen (Mar 6, 2022)

With all that's going on in the world today, how will it affect the housing market? Would you buy in today's market? If you were renting, would you sign a one or two year lease? I mean, will prices be lower a year from now? Inquiring minds want to know.


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## Jules (Mar 6, 2022)

Only thing I wouldn’t do is get a variable rate mortgage if buying.

If renting, I would sign a 1 or 2 year lease, if I really liked the place.


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## Aunt Bea (Mar 7, 2022)

We all want prices to be down when we buy and up when we sell.

I wouldn't be concerned about the housing market or attempt to predict the future.

All any of us need to find is one house or one apartment that suits our situation.

If a new home is a better fit for you than your existing home, go for it.

Good luck!


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## Liberty (Mar 7, 2022)

Betting the housing market will retract within 18 months.  Pray we don't have another recession.


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## SeniorBen (Mar 7, 2022)

Jules said:


> Only thing I wouldn’t do is get a variable rate mortgage if buying.
> 
> If renting, I would sign a 1 or 2 year lease, if I really liked the place.


I guess I should have phrased my question a little better. It should have been: if you have the option of signing either a one or two year lease, what would you choose? You can sign a one year lease or you can sign a two year lease.


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## Packerjohn (Mar 7, 2022)

The average house price in Canada right now is around $750,000.  The cheap mortgage rates are ended and interest is starting to climb.  Folks bidding on houses is wrong.  I blame the real estate crooks for this blunder.  Many immigrants coming to Canada these days.  Do I see a bubble bursting in the real estate business?  I sure do?  I am glad to be renting.


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## Don M. (Mar 7, 2022)

Housing has been in a Supply and Demand situation....with excess Demand....for the past couple of years.  As a result people are paying ridiculous prices for any property that becomes available.  How long this will last is anyone's guess, but eventually this Bubble WILL burst, and leave a lot of people with huge mortgages on properties that are declining in value.


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## dseag2 (Mar 7, 2022)

We saw it in 2005.  The Housing Bubble.  At that time it was due to ridiculous loans.  Today's Housing Bubble is due to limited supply and strong demand.  It is also due to speculative real estate investors that tie up inventory.

I think this time it will take a bit more time to work itself out but new construction over time should contribute to lower prices.


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## Ken N Tx (Mar 9, 2022)

Aunt Bea said:


> If a new home is a better fit for you than your existing home, go for it.


In our area, you better have another house lined up before you put yours on the market!!


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## Lee (Mar 9, 2022)

Home prices in our area have increased a whopping 37% over this time last year and that was on top of an increase of 43% the year before.

Since we are on average lower than some of the bigger surrounding cities,  we are becoming the go to choice for those looking to relocate from places such as the Toronto area.

Been thinking about selling but the question is "where do I go?" Apartments in decent buildings have a long wait list, on average $1600 an up. I am on a wait list for an apartment, signed just in case, but do not expect to be called anytime soon. But if it happens I will buy a summer trailer again and cozy it up for winter in an apartment.

https://blackburnnews.com/chatham/c...8/average-price-home-ck-tops-500k-first-time/


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## RadishRose (Mar 9, 2022)

13 seconds


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## StarSong (Mar 9, 2022)

Ken N Tx said:


> In our area, you better have another house lined up before you put yours on the market!!


Same here.


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## StarSong (Mar 9, 2022)

RadishRose said:


> 13 seconds


This character was especially funny because his job was being a motivational speaker.


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## officerripley (Mar 9, 2022)

StarSong said:


> Same here.


Here as well.


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## Lethe200 (Mar 19, 2022)

We own a SFH in the San Francisco Bay Area. Have been living in the area since 1969. Any pullback is slow in coming and fast to recede, and prices continue to rise.

It's simple economics. We (politically, despite NIMBYism and a zillion different building codes & permits unique to each one of the 100+ cities that make up the SFBA, which is a VERY SMALL part of California) are gradually increasing density by building condos and mixed-use buildings (commercial offices with housing on upper floors).

But you can't wave a magic wand and invent more land. We are constrained geographically (by topography) and transportation-wise, and there is no way to affordably build SFHs except by going outside the boundaries of the 9 counties that make up the SFBA.

The lockdown and Work From Home (WFH) has pushed up exurb prices as young families search for enough room for a couple of kids plus two separate office spaces. 

Only small business contractors are interested in doing the "remodel/flip" that is the biggest indicator of gentrification. This is where an older, small cottage that is a SFH but in an area zoned Z-2 or Z-3 (approved for 2 or 3 building units), is remodeled or replaced by a duplex or triplex. It's expensive and time-consuming, although profitable. 

Due to the pandemic, however, a lot of homeowners - like us! - are staying put. We were thinking of looking into a condo rental or senior living, but the lockdown made us glad we hadn't gotten to the Point of No Return, and stayed put instead. The result is that inventory is very, very low, and realtors are bracing for bad times again. There are not enough SFHs for the # of buyers, and with interest rates rising only the buyers who have sufficient cash/assets will qualify. 

This being the SFBA, there will still be a lot of buyers who qualify - $125K/yr is poverty level for a family of 4 in this area, LOL - but a lot of people who jumped into getting a RE license for 'easy money' won't be able to find enough clients to survive.


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## StarSong (Mar 20, 2022)

This is Economics 101 being demonstrated in living color.  The law of supply and demand.  When demand exceeds supply, prices go up.  When supply exceeds demand, prices go down. 

As @Lethe200 pointed out, there is a limited supply of land and homes in highly desirable areas.  Demand (and prices) in some areas began rising a few years before the pandemic because Millennials entered the market in force.  The market became superheated during the pandemic, prices skyrocketed, and historically low interest rates fanned the flames.     

In my own neighborhood more houses have been sold in the past 3-4 years than any other period of my 35+ years of living here. People interested in downsizing, cashing out, moving to less expensive areas, whatever, have been taking advantage of this (quite literally) golden opportunity. No need to spend big bucks updating or prettying up their houses up either. Bidding wars are the rule, as are prices well over asking. Many sales are all cash, no contingencies, no inspections. 30 day escrows if the buyers can get the sellers to agree. 

Considerably higher interest rates could cool the market, but the Fed's paltry 25 basis point raise was little more than a we've-got-your-back wink and nod at the stock and real estate markets. 

Just my humble opinion.


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## charry (Mar 20, 2022)

The housing market here has gone out of control….especially the rental market….
what you get for the money…..


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## Jeni (Mar 20, 2022)

in my area people are buying some with crazy prices for small places   ....
there seems to be two types of people
1, those who hope it goes down some before jumping in
2, those who feel it is only going up up up ......so paying insane prices

I am beginning to see the commercials like I  saw prior to house bubble ..... refinance with cash out etc where people get them selves underwater on a home really quick....

Honestly regarding rentals one of my sons has a rental unit...... priced it fairly and had trickle of interest ...
raised the asking  rent had more people apply to rent .....because at low rent they thought place was probably a dump and not worth looking at....it was ironic he raised rent and found renters same house / location etc
just people thinking " good place will be more then $X..."


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## Alligatorob (Mar 20, 2022)

SeniorBen said:


> What's your prediction for the housing market?


The bubble will burst, and prices will drop.  I am thinking soon, before or after the next presidential election is the question.  Biden and company will sure try hard to prop things  up until then, possibly with success.  The drop maybe as bad or worse than ~15 years ago, hopefully not.  

It will be driven, in part, by rising interest rates, of course.

That's my prediction, I am usually wrong...


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## StarSong (Mar 20, 2022)

Alligatorob said:


> The bubble will burst, and prices will drop.  I am thinking soon, before or after the next presidential election is the question.  Biden and company will sure try hard to prop things  up until then, possibly with success.  The drop maybe as bad or worse than ~15 years ago, hopefully not.
> 
> *It will be driven, in part, by rising interest rates, of course.*
> 
> That's my prediction, I am usually wrong...


If the weak-kneed response shown so far by Jerome Powell continues, that may take a very l-o-n-g time.


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## Pepper (Mar 20, 2022)

I predict the rich will own almost all of private housing and the rest of us will pay rent to them.  That's the way it's heading, the rich & the speculators buying up most available properties and raising rent for everyone else.  It's a Grab with a capital G.


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## StarSong (Mar 20, 2022)

Pepper said:


> I predict the rich will own almost all of private housing and the rest of us will pay rent to them.  That's the way it's heading, the rich & the speculators buying up most available properties and raising rent for everyone else.  It's a Grab with a capital G.


Since its inception the US government has been mostly run by the wealthy so our laws benefit them the most..  Our tax laws are friendliest toward portfolio and passive incomes and harshest toward earned income.  The loopholes for long-term capital gains, investments and rental incomes are wide enough to fly a 747 jet through.  Personal income loopholes are fewer, farther between, and much less generous.   

As always, lawmakers take care of themselves, their cronies and the lobbyists.


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## Timewise 60+ (Mar 20, 2022)

Irrespective of the Ukranian war, our real estate markets, in the USA are very high, across the board now.  This is a sellers' market, not a buyers' market.  I would not buy a home in this market.   Rents are also up, so I would avoid signing a lease for more than a year.  If the war continues and expands the stock markets will react and start dropping as investors seek safety pulling out of stocks.  In turn real estate will level out or drop and if it goes on long enough, God I hope not, the rents could actually start to drop...that typically is the last to adjust.  All my financial people are saying stay the course for now, don't buy or sell, try and ride it out.


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## David777 (Mar 20, 2022)

My prediction is as long as citizens keep their heads down in a hole in the ground, our politicians will allow the current status quo of big money driving up real estate prices.  At the same time they are continuing to allow open immigration to make sure the supply and demand remains high. News media controlled by wealthy is overwhelming silent about the real game IMO making ordinary people fools.

We working class people are being killed by wealthy both inside and outside the USA increasingly using the global investment corps here in the USA to fund their acquisitions of rental properties and airnb's. An explosion of numbers of owner not occupied properties also squeezing working people in the middle. Politicians set this up after the 2008 economic collapse and we are being skewered.  Rich foreigners with their extended families can move right into places like California by just spending above the threshold, no questions asked.  In some cases these immigrants then become citizens just to legally funnel outside money in without it showing up as foreign sourced since places like Vancouver began clamping down. Canada is trying to do something.  In the USA big money tries to hide the issue making other excuses.  For every critical link like the below, there are dozens of dozens of REIT advertisements for investors.


https://www.nar.realtor/blogs/econo...s-commercial-real-estate-increased-49-in-2021

Foreign Investor Acquisitions of U.S. Commercial Real Estate Increased 49% in 2021

snippet:
_Among NAR commercial members, multifamily buildings and land were the preferred property acquisitions of foreign buyers of NAR commercial members. Multifamily buildings accounted for 25% percent of foreign buyer commercial purchases, while land accounted for 21%_

Example in one of their favorite markets:

_Amid pandemic, foreign buyers spent $634 million on Austin-area properties, report finds_
https://www.statesman.com/story/bus...tin-area-properties-amid-pandemic/8551690002/
snippet:

_ “Over the last year, international buyers showed a preference for townhouses and condominiums for use as investment or vacation properties. The bottom line is that Austin continues to attract people from all over the world, and we welcome them to our community whether they are looking to relocate or invest.”_

Could Banning Foreign Real Estate Buyers Improve Affordability and Fight Corruption?
https://www.propmodo.com/could-bann...s-improve-affordability-and-fight-corruption/

_Foreign buyers have been active in Canada, where buyers primarily from  Mainland China and Hong Kong have pushed up the price of a home in Canada by 16 percent in just one year. The Canadian Real Estate Association’s (CREA) home price index is up 69.7 percent since November 2015, when Trudeau first took office. The problem extends south, where foreign buyers purchased $54.4 billion worth of homes in the United States in the last 12 months, helping to drive the average price of a home up 15 percent, according to NAR. The problem, as PM Trudeau spoke to, is foreign buyers are not likely to live in the home they purchased. Numbers are notoriously hard to track, but in the United States, only 43 percent of foreign buyers purchased the property as a primary residence. That means the majority of foreign buyers are using property in the United States and Canada as a place to park money. It’s more nefarious than it seems and has long been the target of regulatory ire. Affordability is a new wrinkle in a problem no one is eager to solve. _


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## Don M. (Mar 20, 2022)

Housing in the major cities is becoming ridiculously overpriced.  But, for retirees who are still fairly active and healthy, this offers them an opportunity to sell their house for a huge profit, and move to a more affordable area.  
We live in a rural forest area, and there have been a couple of properties nearby, which sold in the past year.  Both sold quickly, to retirees, and at a reasonable price.


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## Nathan (Mar 20, 2022)

SeniorBen said:


> What's your prediction for the housing market?


It'll be a typical cycle of supply and demand, for the near future prices will climb, the 'bubble' will burst and prices will come down.

I do pretty well at Blackjack and Poker, but like real estate they've not been top earners in my portfolio.


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## Lethe200 (Mar 20, 2022)

This is from our local paper today:

*Is now the hardest time to buy a Bay Area home?*
Real estate analysts recently saw the fastest rise in U.S. home prices over any 12-month period in 45 years
Bay Area News Group: March 20, 2022 (edited for length)

Rising home prices. Growing demand from first-time buyers. A near-record-low number of homes for sale. Bidding wars flying $1 million over asking prices. Is this the toughest time to buy a [San Francisco] Bay Area home?

Affordability has neared all-time lows, with home prices climbing far faster than incomes. Bay Area buyers without healthy cash reserves, big down payments and quick decision-making are getting left at the starting gate. In January, real estate analysts saw the fastest rise in U.S. home prices over any 12-month period in 45 years.

In the Bay Area, agents and economists say the decade-long rising market has grown increasingly frustrating for buyers. Data from the California Association of Realtors (CAR) paints a stark picture: The number of Bay Area single-family homes for sale in January dropped by 40% from the same month in 2020.

At the same time, the typical home in the nine-county region sold for nearly 6% over asking price – a higher premium than any January since CAR started tracking the data in 1995. Bay Area houses have typically sold for at or below list prices. The median price of a single-family home was $1.25 million at the end of last year.

And the premiums for single-family homes in the core counties have escalated to recent, record highs, according to the data. San Francisco homes sold, on average, more than 21% over list price in February, while Alameda County prices went 17% higher than list price, followed by Santa Clara (nearly 17%) and San Mateo (13%) and Contra Costa (6%) counties.

The typical home in Santa Clara and San Mateo counties in February sold in 7 days, the fastest time since CAR began tracking days on the market in 1995. Alameda and Contra Costa county homes sold in a near-record 8 days. “It definitely is the most competitive era we have seen,” said CAR economist Oscar Wei.

The stories from real estate agents around the region point to hard times for buyers. *The influx of millennials looking for their first home, the fear of faster-rising mortgage rates and a push to convert volatile stock portfolios into property have super-charged demand. Many sellers have been reluctant to move and face their own daunting home search, pinching supply.*


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## Don M. (Mar 20, 2022)

60 Minutes did a report on the housing situation, this evening.  According to them, the U.S. needs at least 4 million housing units to stabilize the demand.  New housing construction faded rapidly after the 2008 housing bubble, but the population has continued to increase in the past decade, so it's understandable why prices have gone so high.  

The worst part of the nation appears to be in the Southern States....every State from Arizona to the Gulf coast and even the Eastern seaboard.  Further North, the Chicago area has remained fairly stable, and Kansas City has even seen a slight decline in rental costs.  

The high prices in California may start driving companies and people into more affordable areas.  Tesla has already announced that it is moving its headquarters from CA to Texas....this may be the start of a growing trend.


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## caroln (Apr 7, 2022)

I had to chuckle when I saw this in Fortune Magazine:
_"Why does the Mortgage Bankers Association expect home price growth to slow down? It boils down to *soaring mortgage rates*. This year, the group forecasts that the 30-year fixed mortgage rate will average 4.5%—up from 3.1% in 2021. As of Thursday, we're already up to an average 30-year fixed mortgage rate of 4.42%, according to Freddie Mac."_

Soaring mortgage rates???  If today's home buyers didn't live through the '80s, they ain't seen nothin' yet!


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## jimintoronto (Apr 7, 2022)

Lee said:


> Home prices in our area have increased a whopping 37% over this time last year and that was on top of an increase of 43% the year before.
> 
> Since we are on average lower than some of the bigger surrounding cities,  we are becoming the go to choice for those looking to relocate from places such as the Toronto area.
> 
> ...


Did you notice the announcement yesterday that the Liberals intend to introduce a two year ban on foreign buyers of residential housing in Canada ? That may have some effect, but it isn't the whole answer, in my opinion. JimB.


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## caroln (Apr 7, 2022)

jimintoronto said:


> Did you notice the announcement yesterday that the Liberals intend to introduce a two year ban on foreign buyers of residential housing in Canada ? That may have some effect, but it isn't the whole answer, in my opinion. JimB.


Sounds like a good start though.  The U.S. could take a lesson.


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## jimintoronto (Apr 7, 2022)

caroln said:


> Sounds like a good start though.  The U.S. could take a lesson.


The  current Liberal Federal Government is about to introduce new legislation in Parliament, to create a national mental health program, and a national dental health program. If this passes in the House, the programs would be rolled out in this coming September. The costs to fund these programs would be shared 50/50 by the Federal Government and the Provinces and Territories, equally. Canada tends to have national programs that effect all people, such as the national employment insurance plan, or the maternity leave program, both of which apply in all parts of our country. I think this proposed legislation  will pass, with support from the ruling  minority Liberal party, in conjunction with the New Democratic Party ( one of the three opposition parties in the House ). In Canada it is not  unusual for the Governing party to forge an alliance with an opposition party to get enough votes to pass a  specific bill. Our Federal Parliament has 340 seats. JimB.


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## caroln (Apr 7, 2022)

Wishful thinking that the U.S. would have that type of cooperation between parties.  They seem to forget we are the *United* States of America.


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## Aunt Bea (Apr 7, 2022)

IMO the government should stay out of it.

I don't see how we can consider this a free country if the government has the right to tell us how much we can sell our homes for or who is allowed to buy them.

The same with how much a landlord can charge for rent. 

As far as I know, the landlord or the homeowner doesn't get to tell the government how much they can charge in property taxes.


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## bingo (Apr 7, 2022)

i  think the whole economy  is set for a crash


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## Packerjohn (Apr 7, 2022)

I see a bubble and that bubble is going to go BANG.  Perhaps Bob Wills and his Texas Playboys had it right.  I can just see all those high rollers who invested in the housing market at the wrong time, singing right along with Boy.


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## Don M. (Apr 7, 2022)

bingo said:


> i  think the whole economy  is set for a crash


Me too.  There just isn't Any positive news in recent months.  Prices are soaring on nearly everything...sporadic shortages continue...governments thinking they can solve every problem by "throwing money" at it, creating a huge National Debt....a stock market looking more like a roller coaster, etc., etc.
I'm starting to think, more and more, about buying Gold.  When, not If, reality sets in....probably not too far into the future....we are headed for a scenario much like 1929.


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## squatting dog (Apr 7, 2022)

caroln said:


> I had to chuckle when I saw this in Fortune Magazine:
> _"Why does the Mortgage Bankers Association expect home price growth to slow down? It boils down to *soaring mortgage rates*. This year, the group forecasts that the 30-year fixed mortgage rate will average 4.5%—up from 3.1% in 2021. As of Thursday, we're already up to an average 30-year fixed mortgage rate of 4.42%, according to Freddie Mac."_
> 
> Soaring mortgage rates???  If today's home buyers didn't live through the '80s, they ain't seen nothin' yet!
> ...



You aren't kidding. The house I bought in San Diego in 1986 had a mortgage rate of only 12.8.   and my neighbors wanted to know how I got such a low rate.  Most of them were stuck with A.R.M. rates that eventually ended with them under water after the rate hikes.


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## StarSong (Apr 7, 2022)

squatting dog said:


> You aren't kidding. The house I bought in San Diego in 1986 had a mortgage rate of only 12.8.   and my neighbors wanted to know how I got such a low rate.  Most of them were stuck with A.R.M. rates that eventually ended with them under water after the rate hikes.


Our original loan was a punishing fixed rate of 13-7/8.  Iand that was with a 20% down payment.   I wouldn't wish high mortgage rates on anyone.


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## caroln (Apr 8, 2022)

Once when I was getting a new house, I was shopping around for a mortgage and I was offered a fairly decent rate on an adjustable rate mortgage.  I asked what the highest rate it could go to and was told 19.5%.  I choked on that one for awhile.   Then said, no thanks, I don't think so. Maybe a lot of people that took that deal just didn't believe it could ever get that high...until it almost did!


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## Liberty (Apr 8, 2022)

Don't think it will "bust", just really lose steam.  The difference is like 20% of the housing builds are by big construction companies tied into venture cap REIT money and the build outs are for "rental" not sale.  All around this area, there are subdivisions filled with brand new "rental" houses.  Our ex biz partner and wife sold their big starter castle and are now living in one.  They pay $2 grand a month on a two year lease.

Think when the rents get capped out and the repairs start needing to get furnished, they will be offered up for sale to take advantage of the equities payouts.  Also the rising interest rates will naturally put a halt on home purchases, both new and used so its a different landscape than 2008.  Much less individual speculation going on right now and a different set of circumstances, like now its minus "credit default swaps". 

Like John Bogle said "nobody knows nothing" about the stock market...lol.


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## squatting dog (Apr 8, 2022)

StarSong said:


> Our original loan was a punishing fixed rate of 13-7/8.  Iand that was with a 20% down payment.   I wouldn't wish high mortgage rates on anyone.


Kinda sucked didn't it? I had forgotten about putting the 20% down too.


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