I hate the term real estate. It's cold and business-y, everything that tends to make me hide under the bed. What I write about is space: homes, cafes, places where you can do work, pet the cat, and Google your next-door-neighbor from 10 years ago. I write about places. And I like to do it from a personal perspective.

Sunday, September 18, 2005

Interest-only and other affairs

I've been watching with interest -- if you will -- the rise of this breed of mortgage.

Frankly, I'm pretty convinced that this means a lot of people will lose their homes in 10 years, or earlier if that's when their loan balloons up from interest to an actual payment. This Bankrate article gives a few cautionary warnings, but gets right to the heart of the matter when it says that interest-only allows people to buy more house than they can afford.

People are going to do it, though, particularly in this era of pushing into the horrific housing market before it gets even bloodier. I recently attended a focus group where nearly all of the 12 people in the room said they wanted to buy within the next year because it was a good investment, and seemed to think that taking out an interest-only loan was worth the risk. When asked about the downsides of interest-only, they blanked.

It's cause for caution.

In other news, the New York Times says why use Realtors? Could be a good read for market-savvy sellers.

And the U.S. Department of Justice has apparently filed suit against NAR, targeting an MLS policy that apparently no longer exists. The most interesting bit of info I've turned up on this so far is that the DOJ is the recipient of an Inman Innovator Award. Brings back memories of my time in their Emeryville shop ... and how Brad had wanted a female wrestler by the name of The Poontangler to take the stage at Connect.

Oh my. Memories.

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