As I watched last week’s Republican presidential candidate debate from Oakland University in Michigan, I was not surprised by the lack of questions about how to fix the real estate market, but was taken back by the overall lack of understanding of this issue by some of the candidates. I didn’t watch every single minute, maybe three quarters of the overall debate. Of the portion I watched, ten minutes was devoted to real estate out of the two hours.
A perfect example of a few of the misstatements was Newt Gingrich’s answer to CNBC’s Michelle Cabrera’s question about how to fix the housing market. Paraphrasing: Most economists believe there can be no economic recovery without a recovery in the housing market. In last five years Americans have lost seven trillion dollars in home values, four million Americans are in foreclosure or behind on their payments and 25% of Americans owe more on their homes than they are worth. Governor Romney would allow the free market to take care of things, how do you respond?
Mr. Gingrich’s answer was to immediately bash the Frank Dodd Act and what effects it was having on small banks. To the best of my knowledge and according to the mortgage broker I use, small banks account for less than 5% of all home loans. The government entities; Fannie Mae, Freddie Mac, FHA and VA; hold 90% of all home loans. The other totally wrong statement by the former Speaker of the House, banks make more money on foreclosures than via short sales. Every statistic I have seen on this show banks make between 17% to 20% more on short sales.
Michelle Cabrera went on to point out Governer Romney’s recently released 59 point economic plan didn’t have one point about the real estate down turn. She also alluded to Michele Bachmann’s comment during the Las Vegas debate for moms in foreclosure to “hang on“. There were several good answers but often the candidates would circumvent the question by blaming the current administration and government regulations, especially Frank Dodd.
The point of this post is not to bash Republicans. To fully disclose, I am registered Democrat but have always voted for who I thought would do the best job when I could. Since I live in California, 2011 is the first time there will be open elections here and I fully intend to take advantage of this and if a Republican is the better candidate, they will get me vote.
The purpose of this post is to point out what I believe and was recently confirmed by a new national survey which appeared in C.A.R. Newsline last week. Housing will be more important in this elections than the politicians and pollsters think. Granted the economy will be the number one issue, but housing will be nearly as important when voters go to the poles to cast their vote. They are interlinked but why is it housing gets only ten minutes and the economy to my estimate got sixty minutes in the two hour debate. Maybe we should ask those running and others in office to go through a short sale negotiation with one of the banks who haven’t gotten it yet, sit in on a session where we have to console one of our short sale clients and in the worst case, watch when the sheriff shows up to evict someone being foreclosed on. Maybe then they would send a few more minutes debating on, talking about and who knows, maybe coming up with solutions for this enormous problem. Time to stop the bickering and fix this.
Candidate positions on housing will be important considerations to nearly seven of 10 Americans in the 2012 presidential and congressional elections, according to a new national survey on housing by Move, Inc. This is especially true for Millennials, the next generation of home buyers and the segment expected to play as important a role in the 2012 elections as they did in 2008.
According to the survey, 81.7 percent of Americans consider housing to be a critical piece of the national economic recovery, while 73.1 percent believe conditions for buying a home a year from now will be the same or worse than today. Just under a quarter of Americans expect home-buying conditions will be better.
One in three Americans today think helping homeowners avoid foreclosure should be the next president’s priority in the first 100 days in office. Keeping interest rates low ranked second and making more affordable mortgage credit available placed third.
However, views are mixed when it comes to increasing or decreasing the role of government in housing. The survey found one in three Americans said the role of government in housing should remain the same as it is today, while one in five said it should be increased. Forty-two percent said government’s role in housing should be reduced, especially Americans ages 35 to 64 (56.7%). Just over two-thirds (67.4%) of Millennials said the president and Congress should reduce or keep the role of government in housing the same.
Thank you for reading this post. If I can ever be of help in finding you the perfect property here in the Napa Valley, please email me at Curtis@NapaValleyAddress.com.
Your Broker Extraordinaire, selling Napa Valley Real Estate from its heart, Yountville
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