Written by Robert H. Ruth
“OK, Mr. Peabody…but what happened in 2007, and why is it important that we go back there now?”
“Well Sherman, 2007 was a pivotal year for the United States Housing Economy, a year in which all hell broke loose due to the impact of grossly overvalued Real Estate which had been driven to unsustainable levels by Subprime Mortgage Loans.”
“What are Subprime Mortgage Loans Mr. Peabody?”
“Not so fast Sherman…first let’s talk about how values in Real Estate have changed on a historical basis.
You see, historically, US home values have increased by an average of 2 ½-3 % yearly, but during the period from 2003-2006 values went up by 20-30% per year.”
“That sounds like a lot of appreciation, Mr. Peabody.”