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June 7, 2007

Today's Housing Bubble Post - "Coming Soon"

-- by Dave Johnson

Something new in my area: There are a lot of houses for sale but recently many of the "For Sale" signs have "Coming Soon" written across the top. Coming soon, like not for sale yet? One house a few doors down the street has had a "Coming Soon" banner for about a month now. But it isn't for sale yet, I guess.

Is this a scam to avoid having to list a high number of days that the house has sat without being sold?

Other news, no bailouts soon for people with mortgage troubles: Mortgage Reform Unlikely This Year, Lawmakers And Regulators Say Market Is Showing Signs Of Self-Correcting,

Homeowners unable to pay monthly mortgage bills and facing foreclosure shouldn't count on help from Washington this year.

Regulators and lawmakers seem to be taking a wait-and-see approach as they confront the fallout from several years of lenders making too many home loans to people with inadequate credit.

... The National Association of Realtors said Wednesday it expects sales of existing homes to drop 4.6 percent this year to 6.2 million while the median home price is expected to fall 1.3 percent to $219,000. It would be the first annual drop since the trade group began keeping records in the 1960s.

The foreclosure rate nationwide is rising at an annual rate double that of two years ago. Nearly 2 million adjustable-rate mortgages are forecast to reset at higher rates over the next two years, suggesting the foreclosure rate has not peaked.

Posted by Dave Johnson at June 7, 2007 6:35 PM

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Comments

Very interesting. I have not noticed "coming soon" on real estate signs.

Dave, what's your opinion about a federal bailout of subprime borrowers who are facing foreclosure? Do you believe the govt. should bail them out?

Posted by: jaymuntz [TypeKey Profile Page] at June 8, 2007 10:00 PM

I don't think a bailout is warranted at all. If you borrow money you gotta pay it back. I think a LOT of people have to learn that lesson.

Posted by: Dave Johnson [TypeKey Profile Page] at June 9, 2007 8:41 AM

Very true. Still, I don't think you'll find a lot of agreement about that with your fellow progressives. Sens. Dodd and Schumer have already spoken favorably about a bailout.

There have been some cases where mortgage brokers falsified documents to get people loans they shouldn't have gotten. This will get blown out of proportion and there will be a strong feeling in the country that these borrowers were taken advantage of and should be bailed out.

I agree with you. I think if people who got in over their heads don't get burned, then it will just pave the way for more reckless behavior in the future. I have serious doubts about our will to prevent this type of "moral hazard."

Posted by: jaymuntz [TypeKey Profile Page] at June 10, 2007 9:07 PM

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