Daily Real Estate News October 19, 2007
The current U.S. housing cycle diverged from past experience because the boom was driven by the growth of the subprime market and securitization of it, St. Louis Federal Reserve President William Poole told a monetary policy conference.
"[It] all worked as long as house prices were rising — and it all collapses when house prices stop rising," Poole said. "Obviously, this segment of the market, it is going to be a long time before it comes back."
Poole is a voting member of the Fed's interest-rate setting committee this year.
"I think this housing cycle is ... in many respects is quite different from previous housing cycles, and has unique characteristics from the housing cycles from the postwar period," he said. "And [it] is unlikely to give us much insight into the housing market for the longer run."
Source: Reuters News (10/18/07)
See original article at http://www.realtor.org/rmodaily.nsf/pages/News2007101906
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