No mention of QE3 by Bernanke?

**popsiclestix** · 2012-09-15 02:35

I am surprised no one is talking about how Ben Bernanke announced Quantitative Easing 3 by committing the Federal Reserve in buying $40,000,000,000 per month (or close to 1/2 a trillion per year) on mortgage back securities. This is also on top of Operation Twist. I guess people can change their Locked mortgage rate for a new Adjustable rate mortgage with the lower rate...until rates will have to rise.....

**archibaldcrane** · 2012-09-16 10:10

Pretty stoked, looking at refinancing the house if I can lock in a 3.25% or lower. Not sure why this would make people turn to an adjustable rate mortgage...rates this low scream for locking in fixed.

**test123** · 2012-09-16 11:18

Subsidized housing, all aboard the fail boat.

**Seraph** · 2012-09-16 12:32

Originally Posted by archibaldcrane

Pretty stoked, looking at refinancing the house if I can lock in a 3.25% or lower. Not sure why this would make people turn to an adjustable rate mortgage...rates this low scream for locking in fixed.

Great for you, but personally I am pretty pissed. The wife and I wanted to buy a house in the next few years and this will do nothing but make the prices on the currently overpriced market go even higher. With interest rates this low though, I might not even notice how much I'm being overcharged for a house I want to make a huge down payment on! Noone seems to care about the sum price, as long as that monthly payment isn't too high...

**Plow** · 2012-09-16 14:27

the... housing... market... is... currently... overpriced...

wat

**archibaldcrane** · 2012-09-16 16:06

Seriously, shit is down to like 2002 levels, not sure what there is to complain about.

**Pirian** · 2012-09-16 16:26

Depends where he's trying to get a house. There's a housing shortage in North Dakota, at the moment

**Kerberoz** · 2012-09-16 16:50

People willingly move to North Dakota?

**archibaldcrane** · 2012-09-16 17:01

North Dakota's oil boomtowns are a pretty unique situation that has nothing to do with monetary policy.

**Seraph** · 2012-09-16 17:03

Originally Posted by Plow

the... housing... market... is... currently... overpriced...

wat

It's an upstate New York location thing. Houses around here are selling for more than they were during early 2008, and its the same crap houses with no difference in the last almost 5 years besides the fact that financing cost has gone down. Mind you, my area wasn't experiencing as ridiculous of a housing price bubble as much of the country in 2008, so there wasn't a huge dip in the prices after the crash, but they are totally trying to jack the prices now. It's not even like the area is experiencing a boom or anything, so it makes it discouraging to try and enter the housing game.

In my opinion, part of the problem has been the multiple QE garbage, which drives the rates down, which encourages the sellers to raise the prices since hey, you can afford it now right? Never a better time to buy!! Etc. The other half of the problem is that I live in an "old area" where most of the housing for sale is either garbage 'lets build a development' box houses on lots slightly larger than the foundation, or older people looking to retire and move to a cheaper location by selling their house. They have taken a bath on their retirements, and their healthcare costs (at least locally) are going up by about 10% a year. The realtors encourage them to price the house high, because they want a larger commission, and because everyone else is doing it. As a result, I will watch terrible houses sit on the market for over $300K (yeah, yeah, I know a bunch of you guys live in areas where that would be a steal, I don't, get over it), when there is no way in hell anyone in their right mind would pay over $200K. While they sit there and never sell, because the owners are a bunch of stubborn old people, other people look at the now flooded overpriced market, and think their house is suddenly magically worth more, and they do it too.

**Pirian** · 2012-09-16 17:03

Originally Posted by Kerberoz

People willingly move to North Dakota?

Desperate times call for desperate measures.

**archibaldcrane** · 2012-09-16 17:08

Seraph, just because rates are low doesn't mean its easy to get financing though. Plenty if not most of the buyers leading up to the crash wouldn't be able to get loans right now, you have to have your provable income verified for years and have all your shit together. People's loans fall apart all the time now because they don't have bulletproof applications. It's nothing like the boom, even with low rates.

**Seraph** · 2012-09-16 17:18

Originally Posted by archibaldcrane

Seraph, just because rates are low doesn't mean its easy to get financing though. Plenty if not most of the buyers leading up to the crash wouldn't be able to get loans right now, you have to have your provable income verified for years and have all your shit together. People's loans fall apart all the time now because they don't have bulletproof applications. It's nothing like the boom, even with low rates.

I've been watching the local market housing market with interest for over the last 2 years along with several of my coworkers who share notes on house viewings and pricing findings, and I can tell you for a fact it is exactly as I have described. For me personally, it not getting the loan that is the problem, it's not wanting to get such a large loan to cover what I don't already have to put against the house. I'm just telling you how sellers are reacting. "Oh wow, rates went down again, I'm totally going to raise the selling price on my house by another 10-20K!" Which is why all these houses just sit around for over a year at insane (from a local perspective) prices. There is no big tech or business money here. Local families cannot realistically afford 300K+ houses. A unit or two will be sold occasionally when a rich family moves into town (I'm not even joking either) and that gives sellers even more hope.

I also forgot to mention people who bought 300K+ houses, realized they couldn't afford them, and are now trying to dump the houses at a profit, which they never will. I blame stupid people watching HGTV.

**Stumblingdrunk** · 2012-09-16 21:41

Nothing in this world is worth more than anyone is willing to pay for it. Fuck HGTV

**Xantavia** · 2012-09-17 05:03

Originally Posted by Seraph

I also forgot to mention people who bought 300K+ houses, realized they couldn't afford them, and are now trying to dump the houses at a profit, which they never will. I blame stupid people watching HGTV.

I've always wondered how much of the housing meltdown was due to this. Was it really everybody getting loans they couldn't afford, or idiots who thought they could make a living from house flipping then suddenly getting caught without a buyer.

**Kuya** · 2012-09-17 06:24

It was both. Liberals tend to argue it was more of the latter

**test123** · 2012-09-21 10:27

**Enedin** · 2012-09-21 13:51

This somewhat reminds me of an addict being able to synthesize his own product. Isn't this dangerous in the long term?

**Kuya** · 2012-09-21 14:11

What allows the US government to use its own currency with less restraint than other countries is not its ability to print money as a sovereign. That ability comes from having the dollar be a reserve currency and being a large and highly productive economy.

**Xno Kappa** · 2012-09-21 14:59

Originally Posted by archibaldcrane

Pretty stoked, looking at refinancing the house if I can lock in a 3.25% or lower. Not sure why this would make people turn to an adjustable rate mortgage...rates this low scream for locking in fixed.

Fucking this. Sitting at 4.5% right now.

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