Reading Reaction Journal 1

Reading Reaction Journal #1

Link: http://money.cnn.com/2011/02/22/real_estate/december_home_prices/index.htm

Reference:

Christie, Les (February 22, 2011) Home prices near 2009 lows and may fall more  CNN News

Summary:

        The house price was fall down at the end of 2010. It fell 4.1% compared with 12 months earlier and 1.9% compared with 3months earlier, and it will be continue get lower in the future. The government wants to take away Fannie Mae and Freddie Mac in the housing market. Without the loan guarantees for mortgages, the private mortgage will hurt home price. The 18 of 20 large cities in the U.S lost housing price for the year; Washington and San Diego posted the only gains. S&P reported that Detroit, Cleveland and Las Vegas, home prices have dropped below their 10 years ago.

Reaction:

        Actually I think the housing price falling down is not an evil thing at all. The high housing price caused the Real Estate Bubble, and finally leaded Subprime crisis. So the housing price is suppose to cool down anyway. I just consider the house price in China. The home price in China already extremely expensive, the average incomes need to work over 150 years to buy an apartment, which is incredible. The home price in Beijing is almost 7000 dollar for a square meter. For most people, to buy a apartment is impossible.