Can anyone say "dot com" over again?

A recent Chrisitian Science Monitor article pretty much sums up how insane the real estate market is getting in the USA, and perhaps even globally. When people are using chocolate clad women in bikinis to sell unbuilt condos there must surely be something up. I mean, as far as end of the bubble omens go that really has to beat getting stock tips from shoe shine boys, right? The only thing this over-hyped and over-here bubble lacks is a catchy monica. How about "brick com", or even "brick con"? However if overseas investors keep pouring their bucks into this country (and then sucking them out later) it may just keep the pot boiling for a few more years.

I begin to wonder how much the real-estate boom is fueling the "economic recovery" in the USA? I'll bet its quite a significant factor - some friends of my who are appraisers said this month they've seen a record number of people getting foreclosed because they re-fied their properties to the max and spent all the money on household goods like home entertainment systems and new cars - all stuff that depreciated faster than it becomes obsolete.

Also being surrounded by new condo developments under construction I'd love to see some statistics on how many housing units are lying empty now, compared to during the stock market boom days. Certainly back then it seemed you couldn't buy or rent property for love nor money. However now there seems to be a real surfiet of rental property at well below the cost of paying the mortgage on the same space if you bought it. That leads me to believe their must be a lot of vaccant properties that have been bought as investments with the owners banking on increasing prices that will cover the money they are sinking into mortgage interest payments.

In California and other areas people make the case that the hottest markets are those where land is scarce and the population is growing. In these places the law of supply and demand will ensure that prices keep going, going, up! However the point is that prices are going up faster than wages and sooner or later pretty much everyone will get to the point where they can no longer afford to move anywhere but out of the State, into a smaller property (why bother?) or just not buy anywhere at all and start renting until prices fall again, or wages rise to exceed prices.