Market Sentiment Observer

I may post here relevant (in my opinion), and not necessarily recent, quotes. Rather than analyzing specific investments, I will attempt to focus on investors' sentiment regarding broader asset classes and/or specific securities. These will be my thoughts/reactions/questions, and they are not and should not be taken as investment advice.

About me

In particular, I am interested in investors' sentiment and valuation levels. Disclaimer: I work at an Investment Management firm. My comments on this site are not posted in that role, and no opinions of mine should be construed to be recommendations of or to reflect the views of my employer.

Sunday, June 13, 2010

NY Fed on residential real estate

"The severe decline in house prices in the last few years, combined with the large number of borrowers who had little or no equity at the origination of their mortgages, has led to a dramatic rise in homeowners with negative equity... unless house prices increase substantially, many negative equity homeowners will in fact convert to renters in the years ahead, and the measured rate of homeownership will decline..."

"The Homeownership Gap" by Andrew Haughwout, Richard Peach and Joseph Tracy.
Federal Reserve Bank of New York/Current Issues.