Correcting the Housing Market

Correcting the Housing Market--Is it possible?

Yes. We can turn this ship around. My favorite quote by Oliver Hazard Perry is the famous battle cry in the War of 1812 ....."Don't Give Up the Ship!" We must continue to work together to improve our nation. It was true in 1812 and it is true in 2011!


We have all heard a lot of talk about correcting the housing market from Capital Hill to Pennsylvania Avenue, from Wall Street to the News Media. But so far all we have is talk, well, I wish it were only talk, the squabbling has to STOP. 


Two policy think tanks, the Progressive Policy Institute and Economic Policies for the 21st Century, hosted a conference on October 11th to find ideas and solutions to the housing crisis. It included policy- and law-makers from both parties (Democrats and Republicans), along with president and CEO of national real estate brokerage giant Realogy Corp., the NAR President (National Association of Realtors), other industry leaders and strategists.


The report at the end of the day: Yes, the housing market is going to take some time to recover. But let's start today.


The amount of time bantered about is five to seven years. But we have to start somewhere and we need to start —not a year from now. This isn't about winning your election, it is about helping the Americans you promised to serve from your public office or your corporate seat at the helm of real estate companies. We have to start restoring the faith of Americans in order to stabilize and improve the housing market. . Don't let policymakers continue with the "talk" and "positioning" for their next election. We need solutions to start now.


A few of the ideas that came out of the day-long meeting were to call for the government to intervene in smart ways, like:


• allowing underwater home owners to use money from their retirement accounts to help them stay in their home rather than lose it to foreclosure


• have lenders refinance mortgages of troubled home owners without requiring an appraisal


•  create a share equity program 


• make federally backed mortgages assumable


The attendees believe the market is capable of self-correcting but it needs two things. It needs the federal government to stop intervening (or threatening to intervene) in the market in the wrong way, like:


• by imposing a 20 percent down requirement in the qualified residential mortgage (QRM) rule


• threatening to reduce or eliminate the mortgage interest deduction (MID) which is key component of the benefits to home ownership and will not hinder financial growth for the country


• Piecemeal federal intervention in foreclosure processing isn’t helping, either. (for example, allowing banks to foreclose while homeowners are trying to participate in HARP-the government program for loan modifications & short-sales that have government back benefits-for a loan modification or short-sale)


I have heard many reasonable proposals over the past year from various sources. We don't have a shortage of ideas to help stabilize the housing market, but we need a plan. We have to start somewhere and there is no reason to postpone starting. What we need is leadership...We’ve had plenty of talking about blame. We need to get to solutions.


So tell both parties (or all parties!) to get working! Email your representatives and vote in November!

My promise to my clients: I try to always remember what it is like to walk into this incredibly complex world of buying and selling with little or no knowledge of how the process works. I know that behind the door of your home and in your life there is much more going on than just your real estate transaction. I work with each person, not the house, and with the whole person, not just the issues surrounding the transaction. When I attempt to put myself in your shoes and contemplate what you are dealing with I am most effective.

The Benadum Team

Amy Bumpus

Straight Talk—Always