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Housing Crisis: Tell me your solution
Still looking for your solutions for the real estate crisis.
Herbert C. Haber of Tamarac thinks helping people to stay in homes they can't afford hurts the whole neighborhood...He writes:
The homes are quickly identifiable by the lack of maintenance which is evidenced by the poor appearance of their exteriors....Another facet of the same problem occurs at the meetings of the homeowners' association. Prior to the distress in the residential real estate market, votes to spend money on the upkeep of commonly owned community facilities were routinely unanimously approved by voice votes. Today, whenever proposals are voiced for the expenditure of relatively small amounts of money to upgrade the appearance of the community by planting seasonal flowers, improving irrigation, etc., such proposals are invariably opposed by voting blocs composed mainly of homeowners who have been assisted to remain in homes they are not able to afford. It appears to me that the community's 95% body is being wagged by its 5% tail.
As a result, all of the homes in the community have lower values....
What do you think? Helping those in trouble hurts those who are not?
Harriet Johnson Brackey, the personal finance writer for the Sun-Sentinel, has been an award-winning business...
Comments
In response to Herbert:
I'm curious how he KNOWS 95% of the homes in his area have required mortgage assistance?
Most people naturally tighten their belts during a recession. Painting the home/maintenance isn't quite as important as extra money in the bank. That's always a key factor in how long a recession lingers because people that still can afford "extras" are not spending their money.
As far as home values, does Herbert think his little community was somehow immuned to the nationwide issue of declining home prices?
Lastly, I'm glad I don't live in your community when you have to even vote for whether you plant flowers or not. Seems to me that would just be part of general upkeep, but I know how commandos love control too.
As far as the housing crisis. My first response would have always been, TOUGH, next time buy a house you can afford. Problem is that's also my answer to bailing out all of the banks also. I don't think our economy would have been any worse and possibly even better already had we just let capitalism run it's course.
Since that didn't happen, it kind of irritates me that we taxpayers have given billions to companies and nothing to individuals needing a "bail-out".
Posted by: KCK | March 31, 2009 8:20 PM
I should also say that I have failed to understand why banks have not taken it on their own to work with their mortgage customers.
Just seems to me the banks would lose less money, if they lowered the appreaised value and re-did the mortgage. Instead allowing the home to go to foreclosure/lawyer fees and pennies on the dollar on the courthouse steps.
It would certainly help their float that they need and end all the debate of the mark to market accounting.
Posted by: KCK | March 31, 2009 8:34 PM
Tough? It really is. I'd love to hear from a banker as to why they won't just reduce the loans. It's because they'd have to take the write-down on their books and then they'd need more capital. Or so I think.
Posted by: Harriet Johnson Brackey H | April 1, 2009 10:18 AM