Help Us Spread The News By Sharing These Articles With Others:
|
 How soon will it be before people finally start using the term "depression" to describe what has happened to the U.S. housing market? It has been four and a half years since housing prices began to decline, and they are still falling. In fact, U.S. housing prices have now fallen further during this economic downturn than they did during the Great Depression of the 1930s. Just think about that. We are now in unprecedented territory, and most analysts believe that U.S. house prices will continue to decline in 2011. Mortgage rates have been moving up, mortgage delinquencies are on the rise again, U.S. mortgage lenders have really tightened lending standards and "foreclosuregate" continues to plague the entire mortgage industry. It would be really nice for the overall economy if house prices did go up in 2011, but right now it looks like that simply is not going to happen. (Read More....)
 Over the past several years, the Federal Reserve and the U.S. government have tried everything that they can think of to stimulate this dead horse of an economy but nothing has worked. The Fed has slashed the federal funds rate to record low levels, mortgage rates have been pushed to all-time lows and the U.S. government has spent hundreds of billions of dollars in an effort to get the economy going. But despite all these of these extraordinary efforts, the U.S. economy continues to just lie there like a dead corpse. Never before have the Federal Reserve and the U.S. government done more to try to stimulate the economy and never before have their efforts produced such poor results. Home sales continue to set new record lows, more than 14 million Americans continue to be unemployed, foreclosures continue to soar, personal bankruptcies continue to soar and an increasing number of Americans continue to sign up for food stamps and other anti-poverty programs. All of the things that once worked so well to stimulate the U.S. economy seem to be doing next to nothing here in 2010, and the American people are becoming increasingly frustrated by economic problems that just keep getting worse. (Read More....)
 On Tuesday the National Association of Realtors announced that existing home sales in the United States dropped a whopping 27.2% in the month of July. The consensus among analysts was that we would see a drop of around 13 percent, so when the 27 percent figure was announced it sent a shock through world financial markets. To say that the real estate industry is alarmed by these numbers would be a tremendous understatement. What we are seeing unfold is essentially "Armageddon" for those involved in the housing and real estate industries. The real estate market is grinding to a standstill and a shockingly low number of people are actually in the market to buy a home right now. In the months ahead home sales may pick up a little bit, but only if housing prices start to fall. Why? Because right now there are tons of houses on the market and there are very few qualified buyers available to purchase them and potential buyers are starting to realize this. Buyers are beginning to understand that they have all the leverage now and they are waiting for prices to fall. (Read More....)
 Fannie Mae and Freddie Mac have become gigantic financial black holes that the U.S. government endlessly pours massive quantities of money into. Unfortunately, if the U.S. government did allow Fannie Mae and Freddie Mac to totally implode, both the mortgage industry and the housing industry in the United States would completely collapse. So essentially the U.S. government finds itself between a rock and a hard place. Prior to the financial crisis of the last few years, Fannie Mae and Freddie Mac were profit-seeking private corporations that also had a government-chartered mission of expanding home ownership in America. But now that they have been officially taken over by the U.S. government, they have become gigantic bottomless money pits. It is hard to even describe just how much of a mess Fannie and Freddie are in. However, the unprecedented intervention by Fannie Mae and Freddie Mac in the mortgage market over the past couple of years has been about the only thing that has kept it from plunging into absolute chaos. So what does the future hold for Fannie Mae and for Freddie Mac? Well, according to one estimate, it could take another 5 trillion dollars to "fix" Fannie Mae And Freddie Mac. (Read More....)
 In a very alarming sign for the U.S. economy, foreclosures have continued to dramatically increase in 2010. But there has been a shift. Back in 2007 and 2008, experts tell us that most foreclosures were due to toxic mortgages. People were being suckered into mortgages that they couldn't afford with "teaser rates" or with payments that would dramatically escalate after a few years, and when those mortgages reset, the people who had agreed to them no longer could make the payments. But now RealtyTrac says that unemployment has become the major reason for foreclosures. Millions of Americans have become chronically unemployed during the economic downturn and many of them are losing their homes as a result. But whatever the cause, one thing is certain - foreclosures have continued to skyrocket at a staggering rate. (Read More....)
 Back about five or six years ago, when the housing bubble was still rising, just about anyone could get a mortgage. Lending institutions were handing out ridiculously bloated home loans to almost anyone who breathed. It didn't matter if you had a rotten credit history, it didn't matter if you didn't have a job and in some cases it didn't even matter if you had any income at all. It was basically an orgy of mortgage lending. But now the pendulum has swung 180 degrees in the other direction. Severely burned by the subprime mortgage crash, mortgage lending institutions have been seriously tightening their lending standards. As a result, in 2010 it is extremely difficult to get a home loan or a mortgage modification. In their determination not to get burned again, mortgage lenders have completely overreacted and now a lot of highly qualified people can't get a home loan. (Read More....)
|
|
|
