August 7, 2013

People Have Realized You Can Lose A Lot Of Money

Some housing bubble news from the Washington Post. “President Obama came here shortly after his first inauguration 41 / 2 years ago, pledging to arrest a tide of home foreclosures and to stabilize the deeply wounded housing market. The next few years were a personal and political embarrassment for him: More people lost their homes, housing prices continued to sink, and economic growth was held back by the depressed real estate market. But late in Obama’s first term, after he had upended his policies several times, the housing market started to rebound — and Obama returned here Tuesday to celebrate that recovery and insist that more work needs to be done.”

“‘While it’s been a long, slow process that’s taken longer than any of us would like, we’ve helped millions of Americans,’ Obama said at a high school here. ‘Now we have to build on this progress.’”

“The president outlined a series of policies he said would continue to boost the housing market, including a long-ignored legislative proposal that would allow more Americans to refinance at current low mortgage rates. He also said he is taking executive action to widen the pool of borrowers eligible to receive loans from federally backed programs; many borrowers without the highest-quality credit have been locked out.”

“The president said any future housing system must preserve the 30-year fixed-rate mortgage, a linchpin of the American economy that requires the government to provide guarantees to the housing market because bankers are unlikely to offer such long-term loans on their own. Thirty-year mortgages are rare in other countries, where government plays a far smaller role in housing.”

From Fox News. “Community bankers and mortgage lenders across the country are viewing with skepticism President Obama’s call to do away with government-backed mortgage giants Fannie Mae and Freddie Mac, as the president unveiled his latest housing plan during a speech in Phoenix. ‘Removing them entirely would be devastating,’ Kelly Powers, VP for advocacy at the Arizona Mortgage Lenders Association, told Powers argues that there isn’t enough private capital to step in and take over, and the results on lending could be damaging.”

“‘It would make it much more difficult for people to borrow,’ she said. ‘There would be less liquidity and less players in the game. The requirements would go up and people won’t be able to qualify for loans.’”

The Daily Caller. “President Barack Obama today urged a revival of two devastating mortgage policies that helped inflate the real estate bubble before the economic crash of 2008. ‘Let’s make it easier for qualified buyers to buy homes they can,’ he said in a campaign-style speech in Phoenix, Arizona, today. ‘We should simplify overlapping regulations and cut red tape for responsible families who want to get a mortgage, but who keep getting rejected by banks,’ he said, echoing President George W. Bush’s support in 2002 for lower lending standards.”

From CBS 5. “Many of the students at Desert Vista High School know firsthand what happens when the economy tanks and the housing bubble bursts. ‘We had to leave California where we were from because we couldn’t afford our home anymore,’ said sophomore Pauline Poleyuptewa.”

“‘It’s hard to sell our house in Mesa because we’d lose a lot of money,’ said senior Nick Metzger.”

“Stories like these were common among the nearly 800 high school seniors on hand to witness the president of the United States speak Tuesday afternoon. ‘I think it’s great what he’s saying about renting and owning a home because I know my family would really like to own their own home,’ said Poleyuptewa.”

From AZ Family. “During a quick visit to the Valley Tuesday, President Barack Obama said he wanted to make it easier for qualified people to buy homes. Accomplishing that would make prospective home buyers happy. ‘Frustrating, very frustrating,’ said Melissa Miller, who has been trying to buy a home in Scottsdale for a year and a half. ‘I never thought this experience would take so long. I’m not someone who takes a long time to make a decision on a new home. I love being a homeowner, want to be one again… just waiting, that’s the frustration,’ explained Miller.”

“The frustrations, however, are signs of a healthier housing market in Phoenix and the surrounding suburbs. Home values have risen 20 percent over a year ago.”

“‘Things changed during the recession and what we’ve discovered is renting is the new buying. And people don’t necessarily rent an apartment while waiting to buy a home,’ said Tom Simplot, president of the Arizona Multihousing Association. ‘[People] have realized you can lose a lot of money buying a home.’”

News 4 Tucson. “Some Arizonans are upset with the state for not helping homeowners avoid foreclosure as much as they could. When the federal bailout was created, a portion of it was meant to help out hurting homeowners. However, some insist that the state hasn’t done enough to get that money out to the people. For 75-year-old Rodger Derton, foreclosure is reality. He lost his home last December but had been fighting foreclosure since 2009. He and his wife packed up their life and moved into a friend’s home.”

“‘I talked to them and told them, just knock my payment down,’ Derton told News 4 Tucson. ‘Leave me something to live on.’”

“Derton is upset that no one seemed willing to work with him to lower his payments, so he could stay in the home. ‘Some of them got their houses and property back, some of them got a large settlement to carry them through… that’s all I ask is… be fair,’ Derton said.”

Bits Bucket for August 7, 2013

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