Monday, July 25, 2005

Pop the housing bubble

The NY Times reported today that "sales of existing homes rose 2.7 percent in June to a record pace as home prices soared 14.7 percent from a year ago, the biggest jump in nearly 25 years."

Any of you homeowner's seeing any benefit from this housing bubble? I doubt it. You buy your house, sell high, and then what? You have to go out and buy another house at an inflated price.

The only people making money in this boom are investors who buy houses just to turn them around and resell them at a higher price.

This really has to get under control, because while people with money to burn are making more money to burn, workers who save their pennies to buy a house are themselves getting burned in the process.

Could we perhaps have a system where, if you want to own more than, say, two houses, the interest rate doubles? Or maybe the capital gain on the sale of a second house in a year could be jacked up to, say, 50 percent of the profit on the sale.

Then, the only people who will buy houses will be the ones who want to actually live in them.


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