many Americans are the worst with money...this is a crisis in the US

In some ways things are getting cheaper in the U.S. But with oil and fuel costs going up, people have less money to spend overall.

 

A small 1200sf house for 200,000 is about $166 sf which is about $1500 per s.m.

The houses at this price are older and need work or updating. Nothing too bad but not anything special.

You want to buy my house? 3050 sf for $370000 with some extra land to build a second house on. .33 acre

 

What is good - very low inflation in USA. So dollar remains strong in country.

Fuel in my country costs $1.2 already per liter Rent slowly climbing up to USA level

I have even have USA friends who visits time to time, they say things in my country and others they visit costs very much comparing to what they pay locally. I have Levis jeans, they cost me $150. Was good month in income so I spend to some nice clothes Now I realise if I order directly from USA even with shipment it will costs me $50, ok maybe $75. So I'll do that next time, at least they are from new collection, lol

Only point we don't have $xxx/hour lawyers, doctors, etc. So services still somewhat low.

 

Oh, that's what I mean, but mine flat in current local market price costs $2k/meter, 177 s.m. Same condition like yours (older and need work or updating. Nothing too bad but not anything special)

So we almost have a nice exchange deal

Sure we have something like $1000/meter, even lower sometimes. But something accros my town is $1500/meter. In capital up to 2 times more.

 

The advantage to a "weak dollar" is just that. It increases U.S. exports.

Just like the dis-advantage of the "strong Euro" is that companies start moving jobs out of the Euro-Zone to save on wages.

20 years ago none of this matter, but it's safe to say the economy is getting a lot more global and quickly. And all in all, all of us are paying more for items we're used to getting.

 

Inflation is not low.

Shadow Stats puts inflation of real CPI @ 11%. IIRC, FED core inflation is 4% but that excludes food and energy.

The crunch is coming, and people would be wise to arrange their finances conservatively so they don't have to hurt from it.

 

Oh...didn't hear about 11%. Well that usual Ukrainian rate for example, but since last years it's kinda 22%(

 

You didn't hear about 11% likely because Shadow Stats is a subscription based newsletter.

 

What city are you talking about? You wouldn't find a lot in Manhattan for 10x that price.

 

He quoted me and I was talking about southern Oregon

 

Southern Oregon is a nice place. Is the $80,000 building lot for Ukraine or Oregon? Manhattan really isn't a good guage on prices. Europeans and Asians are pushing up prices due to the low dollar.

 

I am not sure about building lot and what it is. Is it just draft of building which will be built ? For $80k you can buy about 80 square meters flat in bad place of my town. Also it will be just as is from developers, so no ready to live.

 

Excellent! This means that more Americans will be able to afford to buy homes now.

 

I've thought about that logic, and while it does make some sense (for example, Ron Paul agrees with you), they can only afford to buy them if they are able to obtain credit.

And right now, lending is tight. Particularly mortgages.

 

no lending is going back to normal, you used to have have 20% to put down on house, this is how it was

http://www.usatoday.com/money/perfi/housing/2006-01-17-real-estate-usat_x.htm

you know how many people actually have 100k to put down on that 500k house, not many, most people can't even buy a car without a loan

prices are starting to fall faster where I live, they are dropping on some properties 50k at a time

still haven't dropped enough imho, there are still people trying to get that 300k for a 400 sf studio cause its "cute"

 

Prices still have a long ways to go before they become realistic. Subprime interest resets will not peak on ajustable rate mortgages until the end of the second quarter. Inflation and higher unemployment are also causing more people to go into default.

 

Yeah, there's circular logic here if you say it's good because more people can afford homes because the prices are so low. The prices are low because people are defaulting and new buyers are having trouble getting credit which puts more houses on the market which lowers the prices. So there is opportunity right now for people who have money/assets to make good investments, but not so much for regular people.

 

Dropping home prices don't really reduce the cost of living...

a) rent isn't dropping (not here anyway)
b) mortgages don't suddenly cost less because the house is worth less

Since 80% of Americans already owned a home before the prices started crashing, they are paying whatever the price was when they bought it. Cost doesn't go down, just aggregate wealth.

It might theoretically help younger people coming out of college looking for a cheap first home, but there are also less jobs at lower pay available than previously.

 

Not all Americans make 30,000+ a year. At my job I make 10,000 a year. Now If I wanted to live alone in a rundown apartment rent would be about $700 inc utilities. So If I lost my job just one month I would loose my home. We may make more but are products cost more to purchase. Theres just not a cheap place that we can live if we loose our jobs. In most countries you can grow your own food with ease. Its hard in many parts of the states. I live in a city I would probably never have a chance to grow my own food build my own place to live if I was jobless like many other countries you can.