The credit crunch is a funny thing. I don’t think its as straightforward as “US homeowners can’t afford to remortgage, so sell, so prices drop, ergo real estate isn’t safe”. Its not clear to me who have lost more: people in real estate or people in mortgage backed securities that were sold with dubious AAA ratings.
My real estate is here, and its obviously doing very well, and I didn’t have much exposure to sub-prime debt, so I don’t know exactly where that is hurting most (my equity holdings have suffered from the volatility, obviously, but they haven’t lost much ground). When you don’t feel the pain directly, you don’t always appreciate it, and (so far at least, as I’m sure the bears will hasten to remind me), I haven’t felt the pain at all, let alone directly.
The question I throw out for discussion is: where will the sub-prime spawned credit crunch hurt most? In the actual real estate markets where it began? In all real estate markets? Or in other areas?