Refinance Bill Drastically Alters Market

[DWCAP]

[quote=pri_dk] The problem with many of these points are that they are based upon abstract notions and not a practical course of action. It’s too late to fret about moral hazard. We have to act. Moral hazard won’t be a problem moving forward anyway, because lenders are now going to be very careful with their funds for very long time.
[/quote]

What history I know does not support your point here. Moral hazard will resurface with a vengence, but it will take a few years. The United States is rife with examples of poor lending and land booms/busts. Southern Ca has been doing that pretty steadly for the past 30 years or so. We have not learned our lesson, and will not learn our lessons because we have almost no respect for history or ability to learn from it.

[sd_matt]

[quote=permabear][quote=CA renter]Interesting…I also heard that one of the biggest banks has gotten some sort of authorization to hold inventory off the market for five years. They aren’t even going to rent them out, apparently. They are going to board them up and maintain them for five years. [/quote]

It would not surprise me based on history. In the Great Depression 1.0, people were actually paid to knock down homes in order to rid communities of dilapidated properties inhabited by squatters. Plus, it helped reduce inventory.

The modern equivalent that banks are now undertaking is to make homes unavailable – vacant – basically the same thing, assuming the banks can carry the costs. In the Great Depression 1.0, banks went out of business, which rendered that approach moot.[/quote]At first thought I don’t anticipate properties being knocked down in large numbers in SD.

Unrelated; The other thing my realtor told me is that the reason the banks are withholding inventory is to try to bully Congress into giving more cash handouts.

Since the banks seem to be able to survive while holding massive amounts of non-performing assets I guess the bailout did indeed pay for the first and second wave of foreclosures. Or am I talking too soon?

[sd_matt]

[quote=permabear][quote=CA renter]Interesting…I also heard that one of the biggest banks has gotten some sort of authorization to hold inventory off the market for five years. They aren’t even going to rent them out, apparently. They are going to board them up and maintain them for five years. [/quote]

It would not surprise me based on history. In the Great Depression 1.0, people were actually paid to knock down homes in order to rid communities of dilapidated properties inhabited by squatters. Plus, it helped reduce inventory.

The modern equivalent that banks are now undertaking is to make homes unavailable – vacant – basically the same thing, assuming the banks can carry the costs. In the Great Depression 1.0, banks went out of business, which rendered that approach moot.[/quote]At first thought I don’t anticipate properties being knocked down in large numbers in SD.

Unrelated; The other thing my realtor told me is that the reason the banks are withholding inventory is to try to bully Congress into giving more cash handouts.

Since the banks seem to be able to survive while holding massive amounts of non-performing assets I guess the bailout did indeed pay for the first and second wave of foreclosures. Or am I talking too soon?

[sd_matt]

[quote=permabear][quote=CA renter]Interesting…I also heard that one of the biggest banks has gotten some sort of authorization to hold inventory off the market for five years. They aren’t even going to rent them out, apparently. They are going to board them up and maintain them for five years. [/quote]

It would not surprise me based on history. In the Great Depression 1.0, people were actually paid to knock down homes in order to rid communities of dilapidated properties inhabited by squatters. Plus, it helped reduce inventory.

The modern equivalent that banks are now undertaking is to make homes unavailable – vacant – basically the same thing, assuming the banks can carry the costs. In the Great Depression 1.0, banks went out of business, which rendered that approach moot.[/quote]At first thought I don’t anticipate properties being knocked down in large numbers in SD.

Unrelated; The other thing my realtor told me is that the reason the banks are withholding inventory is to try to bully Congress into giving more cash handouts.

Since the banks seem to be able to survive while holding massive amounts of non-performing assets I guess the bailout did indeed pay for the first and second wave of foreclosures. Or am I talking too soon?

[sd_matt]

[quote=permabear][quote=CA renter]Interesting…I also heard that one of the biggest banks has gotten some sort of authorization to hold inventory off the market for five years. They aren’t even going to rent them out, apparently. They are going to board them up and maintain them for five years. [/quote]

It would not surprise me based on history. In the Great Depression 1.0, people were actually paid to knock down homes in order to rid communities of dilapidated properties inhabited by squatters. Plus, it helped reduce inventory.

The modern equivalent that banks are now undertaking is to make homes unavailable – vacant – basically the same thing, assuming the banks can carry the costs. In the Great Depression 1.0, banks went out of business, which rendered that approach moot.[/quote]At first thought I don’t anticipate properties being knocked down in large numbers in SD.

Unrelated; The other thing my realtor told me is that the reason the banks are withholding inventory is to try to bully Congress into giving more cash handouts.

Since the banks seem to be able to survive while holding massive amounts of non-performing assets I guess the bailout did indeed pay for the first and second wave of foreclosures. Or am I talking too soon?

[sd_matt]

[quote=permabear][quote=CA renter]Interesting…I also heard that one of the biggest banks has gotten some sort of authorization to hold inventory off the market for five years. They aren’t even going to rent them out, apparently. They are going to board them up and maintain them for five years. [/quote]

It would not surprise me based on history. In the Great Depression 1.0, people were actually paid to knock down homes in order to rid communities of dilapidated properties inhabited by squatters. Plus, it helped reduce inventory.

The modern equivalent that banks are now undertaking is to make homes unavailable – vacant – basically the same thing, assuming the banks can carry the costs. In the Great Depression 1.0, banks went out of business, which rendered that approach moot.[/quote]At first thought I don’t anticipate properties being knocked down in large numbers in SD.

Unrelated; The other thing my realtor told me is that the reason the banks are withholding inventory is to try to bully Congress into giving more cash handouts.

Since the banks seem to be able to survive while holding massive amounts of non-performing assets I guess the bailout did indeed pay for the first and second wave of foreclosures. Or am I talking too soon?

[Anonymous]

[quote=DWCAP]The United States is rife with examples of poor lending and land booms/busts.[/quote]

There are cycles in real estate – always will be. There have also been many failed “projects,” like the Salton Sea.

But massive national debt crises such what we are experiencing today are actually rare. There’s nothing wrong with real estate declines and risky ventures as long as the government doesn’t foot the bill.

The S&L mess in the 1980s is the only example in our lifetime. It was not nearly as big as today’s crash, and the government bailouts didn’t really impact the economy.

The only example of a bust as big as today’s was in the 1920s, concentrated mostly in FL. It’s no coincidence that an entire generation passed before it happened again. And it will happen again in the future – at least 50 years from now when we are all dead (or so old no one will listen to us!) But there’s nothing any legislation today will do to cause or prevent something so far off in the future.

[Anonymous]

[quote=DWCAP]The United States is rife with examples of poor lending and land booms/busts.[/quote]

There are cycles in real estate – always will be. There have also been many failed “projects,” like the Salton Sea.

But massive national debt crises such what we are experiencing today are actually rare. There’s nothing wrong with real estate declines and risky ventures as long as the government doesn’t foot the bill.

The S&L mess in the 1980s is the only example in our lifetime. It was not nearly as big as today’s crash, and the government bailouts didn’t really impact the economy.

The only example of a bust as big as today’s was in the 1920s, concentrated mostly in FL. It’s no coincidence that an entire generation passed before it happened again. And it will happen again in the future – at least 50 years from now when we are all dead (or so old no one will listen to us!) But there’s nothing any legislation today will do to cause or prevent something so far off in the future.

[Anonymous]

[quote=DWCAP]The United States is rife with examples of poor lending and land booms/busts.[/quote]

There are cycles in real estate – always will be. There have also been many failed “projects,” like the Salton Sea.

But massive national debt crises such what we are experiencing today are actually rare. There’s nothing wrong with real estate declines and risky ventures as long as the government doesn’t foot the bill.

The S&L mess in the 1980s is the only example in our lifetime. It was not nearly as big as today’s crash, and the government bailouts didn’t really impact the economy.

The only example of a bust as big as today’s was in the 1920s, concentrated mostly in FL. It’s no coincidence that an entire generation passed before it happened again. And it will happen again in the future – at least 50 years from now when we are all dead (or so old no one will listen to us!) But there’s nothing any legislation today will do to cause or prevent something so far off in the future.

[Anonymous]

[quote=DWCAP]The United States is rife with examples of poor lending and land booms/busts.[/quote]

There are cycles in real estate – always will be. There have also been many failed “projects,” like the Salton Sea.

But massive national debt crises such what we are experiencing today are actually rare. There’s nothing wrong with real estate declines and risky ventures as long as the government doesn’t foot the bill.

The S&L mess in the 1980s is the only example in our lifetime. It was not nearly as big as today’s crash, and the government bailouts didn’t really impact the economy.

The only example of a bust as big as today’s was in the 1920s, concentrated mostly in FL. It’s no coincidence that an entire generation passed before it happened again. And it will happen again in the future – at least 50 years from now when we are all dead (or so old no one will listen to us!) But there’s nothing any legislation today will do to cause or prevent something so far off in the future.

[Anonymous]

[quote=DWCAP]The United States is rife with examples of poor lending and land booms/busts.[/quote]

There are cycles in real estate – always will be. There have also been many failed “projects,” like the Salton Sea.

But massive national debt crises such what we are experiencing today are actually rare. There’s nothing wrong with real estate declines and risky ventures as long as the government doesn’t foot the bill.

The S&L mess in the 1980s is the only example in our lifetime. It was not nearly as big as today’s crash, and the government bailouts didn’t really impact the economy.

The only example of a bust as big as today’s was in the 1920s, concentrated mostly in FL. It’s no coincidence that an entire generation passed before it happened again. And it will happen again in the future – at least 50 years from now when we are all dead (or so old no one will listen to us!) But there’s nothing any legislation today will do to cause or prevent something so far off in the future.

[eavesdropper]

[quote=CA renter]There is no excuse for homes sitting empty. A home should be empty for no more than 90 days.

The foreclosure process can be made much more efficient. We need a public auction system where all the bidders are pre-qualified through one of the GSEs and each person/entity is assigned a bidder ID number. All transactions/entities should be tracked and audited periodically for irregularities. There should be open bids where the bid amounts, terms, and ID number of the bidder is visible to all other bidders. Mimimum 14-40 day listings on the govt-run site, and highest and best bid wins.

No middlemen, no fraud (it would be fully transparent, with HUGE penalties for anyone caught trying to scam the system), and regular end-users would be on the same footing as flippers/speculators.[/quote]

I like this, CAR. Of course, something this simple, this efficient, and this good at leveling the playing field will never be adopted. Not to mention that it involves a considerable degree of oversight which, I believe, is equated with violation of the Constitution in some circles these days.

[eavesdropper]

[quote=CA renter]There is no excuse for homes sitting empty. A home should be empty for no more than 90 days.

The foreclosure process can be made much more efficient. We need a public auction system where all the bidders are pre-qualified through one of the GSEs and each person/entity is assigned a bidder ID number. All transactions/entities should be tracked and audited periodically for irregularities. There should be open bids where the bid amounts, terms, and ID number of the bidder is visible to all other bidders. Mimimum 14-40 day listings on the govt-run site, and highest and best bid wins.

No middlemen, no fraud (it would be fully transparent, with HUGE penalties for anyone caught trying to scam the system), and regular end-users would be on the same footing as flippers/speculators.[/quote]

I like this, CAR. Of course, something this simple, this efficient, and this good at leveling the playing field will never be adopted. Not to mention that it involves a considerable degree of oversight which, I believe, is equated with violation of the Constitution in some circles these days.

[eavesdropper]

[quote=CA renter]There is no excuse for homes sitting empty. A home should be empty for no more than 90 days.

The foreclosure process can be made much more efficient. We need a public auction system where all the bidders are pre-qualified through one of the GSEs and each person/entity is assigned a bidder ID number. All transactions/entities should be tracked and audited periodically for irregularities. There should be open bids where the bid amounts, terms, and ID number of the bidder is visible to all other bidders. Mimimum 14-40 day listings on the govt-run site, and highest and best bid wins.

No middlemen, no fraud (it would be fully transparent, with HUGE penalties for anyone caught trying to scam the system), and regular end-users would be on the same footing as flippers/speculators.[/quote]

I like this, CAR. Of course, something this simple, this efficient, and this good at leveling the playing field will never be adopted. Not to mention that it involves a considerable degree of oversight which, I believe, is equated with violation of the Constitution in some circles these days.

[eavesdropper]

[quote=CA renter]There is no excuse for homes sitting empty. A home should be empty for no more than 90 days.

The foreclosure process can be made much more efficient. We need a public auction system where all the bidders are pre-qualified through one of the GSEs and each person/entity is assigned a bidder ID number. All transactions/entities should be tracked and audited periodically for irregularities. There should be open bids where the bid amounts, terms, and ID number of the bidder is visible to all other bidders. Mimimum 14-40 day listings on the govt-run site, and highest and best bid wins.

No middlemen, no fraud (it would be fully transparent, with HUGE penalties for anyone caught trying to scam the system), and regular end-users would be on the same footing as flippers/speculators.[/quote]

I like this, CAR. Of course, something this simple, this efficient, and this good at leveling the playing field will never be adopted. Not to mention that it involves a considerable degree of oversight which, I believe, is equated with violation of the Constitution in some circles these days.

[Author]

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