Some financial analysts believe the battered housing market needs, yet, another three years to fully recover. While reports from the media tell us “things are getting better,” there are some lingering and hurtful factors which are affecting the housing market’s recovery process.
For starters, unemployment is still high (9.7%) and with no job or source of income, who would be able to buy a home? Where’s the incentive? Most folks are opting to move in with friends or family as the number of persons occupying single family homes are steadily rising.
Another factor slowing the housing market’s recovery is foreclosure. Recent data from RealtyTrac, Inc. indicates home foreclosures may reach an all-time high in 2010; as over 1 million properties and homes will be, or have already been, seized by banks. Joblessness and foreclosure walk hand in hand as millions of Americans, in fighting to avoid both evils, take heed in repairing themselves, rather than test the housing market.
With the housing market barely alive and needing a projected three more years to recover, perhaps the government should bailout the housing market? In a recent Bloomberg article, which gave an overview of the housing market’s recovery, the CEO of MDC Holdings, Inc. (a Colorado homebuilder), Larry Mizel, suggested, “. . . the federal government should allow homes to be foreclosed on and sold at reduced prices to new buyers.” A reasonable suggestion since most lenders these days, aren’t so quick to hand out mortgages like candy—as they used to. They’ve cracked down on lending to unstable homebuyers so consequently, today’s homebuyers aren’t looking at foreclosure within a few years down the line.
If most major markets have been saved by big government and their parade of bailouts, it seems only natural another solution be provided to assist the housing market. HAMP and other government homeowner programs are starting to seem like tiny band-aids on a large cut. They are certainly helpful, yet, to truly expedite the recovery process, more avenues need to be created to make the housing market attractive again.