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Obama housing plan

david_mcmanusdavid_mcmanus
edited March 2009 in The Economy
http://seattletimes.nwsource.com/html/p ... using.html

Personally, I don't think this plan will do anything to make home values from continuing on their downward trajectory.

Comments like this make me chuckle:
It is imperative that we continue to move with speed to help make housing more affordable and help arrest the damaging spiral in our housing markets

Uhhh, housing is getting more affordable every day! It's called a market correction and we don't have to do anything to make it happen. I'm a little confused, though. We want to make housing more affordable, but not make prices drop too much? Maybe I'm missing something. :?

Comments

  • tomtomtomtom
    Ugh.

    http://www.financialstability.gov/

    One of the provisions is to pay homeowners $1000 per year (reduction of principal) to make their mortgage payments on time.

    Personally I believe homeowners under this plan should not be allowed to take the $250,000 exclusion when they sell.
  • david_mcmanusdavid_mcmanus
    It just seems like the gov is rewarding the bad behavior that got them in the situation they're in now. The gov. now teaches me that no matter what I do financially, they will be there to bail me out. Maybe I should just get out there and spend away!

    I heart moral hazard!
  • Lake Hills RenterLake Hills Renter
    david_mcmanus wrote:
    We want to make housing more affordable, but not make prices drop too much? Maybe I'm missing something. :?

    Nope, that is exactly what they are doing. They are trying to make houses more affordable for people that already own them. That also means that the prices will stay unaffordable to those that don't, if the plan works. There's apparently no consideration for buyers whatsoever -- it's about maintaining the (old) status quo.
  • david_mcmanusdavid_mcmanus
    Does anyone have the link to the application for the 1K per year bonus if I made my payments on time? I mean, I've been paying on time for the past 7 years, so I need to get my 7K.
  • EconEEconE
    1k/year bonus? :lol:

    Yeah, that'll be an incentive for all the people in the million$ homes everywhere on the West Coast. :?

    1k/year bonus just suckers them into staying around to pay 10k annually in property taxes.

    Sure...they might modify the mortgage. It doesn't mean the house is worth the "bubble" price...but they'd love to have the homeowner believe that it still is. You can't argue that your home is worth double what you think it is unless you want to pay taxes on it.

    Perhaps we should now refer to overinflated property taxed as "ego taxes"?
  • rose-colored-coolaidrose-colored-coolaid
    Lake Hills Renter wrote:
    david_mcmanus wrote:
    We want to make housing more affordable, but not make prices drop too much? Maybe I'm missing something. :?

    Nope, that is exactly what they are doing. They are trying to make houses more affordable for people that already own them. That also means that the prices will stay unaffordable to those that don't, if the plan works. There's apparently no consideration for buyers whatsoever -- it's about maintaining the (old) status quo.

    I think the real "plan" is to make houses more affordable at exactly the rate of inflation. Just let the market correct over 25 years instead of 2.5 and our current pain will kind of sort of be gone.
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