And, Boston is on the list (natch.). So is Barnstable town(?), Cambridge, and Essex.
You’ve heard it all before.
[Mark Zandi, chief economist for Moody’s Economy.com] … pointed out that there were still reasons to be wary of a potentially more severe slowdown here in the unlikely event that the general economy begins to falter. â€œHousingâ€™s tentacles go deep into the economy,â€? he said, â€œdeeper than many people think.â€?
Zandi also noted that housingâ€™s high sensitivity to shifts in interest rates will become increasingly apparent the longer the Federal Reserve continues driving up those rates by quarter-point increments. â€œAny fundamental rise in interest rates will bite hard,â€? Zandi said, and â€œthe rise will lock out two key groups that are important to local and regional markets: first-time home buyers and investors.â€?
Investors have something valuable to contribute to the long-term vitality of local markets because they arenâ€™t just buyers whose aim is to â€œflip and get out,â€? but include second home buyers, boomers seeking retirement homes and others who are in it for the long haul.
Another cause for concern, Zandi pointed out that there are a substantial number of borrowers at risk of defaulting on mortgages that are for amounts exceeding the value of their homes. â€œWe will see defaulting and foreclosures,â€? he said.
Complete story: Miami Could Be the First Hot Market to Land With a Thump – Nation’s Building News Online