bad bank plan?

[scaredyclassic]

what happens next? does this have any real effect on housng prices in a town near you? do prices rise or even stabilize? seems like mortgage backed securitiesa ren’t going to come back in style just because there’s a pretend market completely financed by the govt right this minute but maybe not later. could this really be the bottom?

[kev374]

my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.

[kev374]

my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.

[kev374]

my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.

[kev374]

my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.

[kev374]

my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.

[(former)FormerSanDiegan]

[quote=kev374]my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.[/quote]

Actually, availability of credit is NOT driven strictly by income. It is also driven by the ability and willingness of the lender to lend. This depends heavily on the lenders’ balance sheets, which is what the plan intends to address.

[(former)FormerSanDiegan]

[quote=kev374]my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.[/quote]

Actually, availability of credit is NOT driven strictly by income. It is also driven by the ability and willingness of the lender to lend. This depends heavily on the lenders’ balance sheets, which is what the plan intends to address.

[(former)FormerSanDiegan]

[quote=kev374]my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.[/quote]

Actually, availability of credit is NOT driven strictly by income. It is also driven by the ability and willingness of the lender to lend. This depends heavily on the lenders’ balance sheets, which is what the plan intends to address.

[(former)FormerSanDiegan]

[quote=kev374]my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.[/quote]

Actually, availability of credit is NOT driven strictly by income. It is also driven by the ability and willingness of the lender to lend. This depends heavily on the lenders’ balance sheets, which is what the plan intends to address.

[(former)FormerSanDiegan]

[quote=kev374]my guess is that it will not have any effect on home prices since the amount any buyer can offer is still driven by 2 things:

1) Income
2) Availability of credit (which now is driven strictly by income)

as long as income does not inflate, home prices will continue to fall until it matches historical affordability. However, with all this massive amounts of money being injected into the market by the government I am not sure when the current wave of deflation is going to turn into inflation, this part is not clear.[/quote]

Actually, availability of credit is NOT driven strictly by income. It is also driven by the ability and willingness of the lender to lend. This depends heavily on the lenders’ balance sheets, which is what the plan intends to address.

[BGinRB]

Lending rules are not strict enough as they are today.

A couple of guys I know took FHA over the past 6 months. I would not willingly lent my money to those guys at the given rate, with the given collateral. So, the government taxed me (or borrowed using my future productivity as a collateral) to give my friends the loans they got. Awesome, because that worked so well over the past several years 🙂

[BGinRB]

Lending rules are not strict enough as they are today.

A couple of guys I know took FHA over the past 6 months. I would not willingly lent my money to those guys at the given rate, with the given collateral. So, the government taxed me (or borrowed using my future productivity as a collateral) to give my friends the loans they got. Awesome, because that worked so well over the past several years 🙂

[BGinRB]

Lending rules are not strict enough as they are today.

A couple of guys I know took FHA over the past 6 months. I would not willingly lent my money to those guys at the given rate, with the given collateral. So, the government taxed me (or borrowed using my future productivity as a collateral) to give my friends the loans they got. Awesome, because that worked so well over the past several years 🙂

[BGinRB]

Lending rules are not strict enough as they are today.

A couple of guys I know took FHA over the past 6 months. I would not willingly lent my money to those guys at the given rate, with the given collateral. So, the government taxed me (or borrowed using my future productivity as a collateral) to give my friends the loans they got. Awesome, because that worked so well over the past several years 🙂

[Author]

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