The San Diego real estate market may not be as bad as Detroit’s–or those in Las Vegas, Sacramento or Miami — but the real estate market here would welcome the opportunity to stabilize.
I am usually inclined to agree with those who believe markets are self-correcting and should be left to their own cleansing processes, but the economic heart attack gripping the world today calls for drastic treatment.
Recognizing that billion$ flowing into insurance companies and banks will do little to directly stabilize our real estate markets, the National Association of Realtors (NAR) suggests the following four steps to aid in recovery:
The Four Point Plan
The most recent economic stimulus bill, the Emergency Economic Stabilization Act, was a good first step towards stabilizing our nation’s economy. Unfortunately, a number of the Act’s provisions have not proven to be as useful at stabilizing the nation’s housing markets as was first thought.
Congress may consider second economic stimulus bill this month. If they do, there are a number of changes that could help to provide more stability to the nation’s real estate markets which most agree is a necessary step towards recovery.
The National Association of Realtors (NAR) is urging Congress to include the following provisions in any future legislation:
- Make the $7500 tax credit available to all purchasers and eliminate the repayment requirement. The credit’s limited availability and required repayment terms have severely limited the credit’s appeal to potential homebuyers. As a result, the credit has not been widely used or proven effective at stimulating sales.
- Make the 2008 FHA, Fannie Mae and Freddie Mac loan limits permanent. New rules for 2009 would significantly reduce the FHA, Fannie Mae and Freddie Mac loan limit from their 2008 levels. Now is not the time to limit the availability of affordable mortgages.
- Get the Emergency Treasury bank relief program back on track by targeting more funds to mortgage relief efforts and increasing efforts to mitigate foreclosures. Don’t just give the banks unrestricted cash. Make the program work to improve mortgage and housing markets as it was originally intended.
- Permanently bar banks and banking conglomerates from engaging in real estate brokerage and management. The banks have proven they have enough to do to simply properly manage their current lines of business. Do we really want them to manage on the home buying process? Imagine what could have been the situation now if they already had the added ability to engage in real estate sales.