We have to figure out how to prop up housing prices and we have to do it quick.
Let’s brainstorm about ways we can support the market.
Obviously we need more people to buy houses and condos.
How can we make that happen? Several ways come to mind:
1. lower lending standards so more people qualify for mortgage loans
2. create new loan products that lower the monthly payment – package them so the borrower doesn’t realize they will never pay the loan off
3. grant amnesty to 12 million people who are already living in the country – create a special housing program for this group – have Uncle Sam buy each family a house and allow them to pay based on their ability
To keep the housing market healthy we’ll need to create some jobs.
Let’s assume that we have unlimitted funds (or a printing press) and see what we can come up with.
The creation of ‘coffee barista’ jobs has been strong lately. Maybe we could create a ‘coffee stamp’ program so all Americans can afford the Banana Coconut Frappuccino that they deserve. Model the program along the lines of the food stamp program. (Note to self: tell cronies to buy stocks of coffee companies before this legislation is passed)
1) NAR radio and TV ads – Raise sales by running a seller education campaign on realistic pricing. The most important thing for the economy, besides construction, is the sale of homes. (Home sales generate furniture sales, etc.) We’ve got to increase transactions, and not worry if house prices are dropping.
2) Government affordable housing programs
3) Loan product for the 30% of Americans who don’t qualify under current loose standards. Loans to the bankrupt, felons, minimum wage worker, etc.
Ha ha! Oh, good topic! It’s really quite simple. Here’s what you do:
1.) First, don’t base the price of the house on any type of economic realty whatsoever because we all know that housing prices in San Diego really have nothing to do with economics any more. Use this simple San Diego Housing price formula:
(Base Price:$50,000) + (Average SD year round temerature: 70)*(house square footage)*(7 days of the week the person will live in the house)
Example for a 1000 square foot house:
$50,000+ (70 degrees)*(1000 sqr ft)*(7 days)= $540,000
2.) Next, if some idiot does not come along and buy the house at your insanely over-inflated asking price right away, just “sit on it” for awhile because this isn’t really a housing bubble (nudge nudge wink wink) and things are going to pick up again soon.
Its all about supply and demand. Lets start burning down houses and having babies. This will create demand in the future and reduce supply now, creating lots of jobs in the construction industry. Call it the “burn ‘n’ boink” program.
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