This Just In: Government Intervention in Housing Market Didn’t Work
Maybe the voices (including mine) that have been calling for allowing the housing market to seek its own level will finally be heard.
Even the New York Times is now questioning the wisdom of using artificial measures to attempt to quash the epidemic of foreclosures and the decline in real estate values.
None of them have worked. Not one. The only “benefit” from all of them was a short term increase in home sales due to the first time homebuyer credit. When the credit expired, so did the sales.
The Times article makes a good point. The government’s failed efforts (costing billions in taxpayer dollars) have been directed at helping current owners whereas letting the market slide naturally will benefit future owners.
Who should we help?
I look at it this way. Many of those current owners shouldn’t have been owners to begin with, which is why the government’s “save the un-saveable” programs have done nothing for them.
Other owners were OK to start. Then they began cashing out their illusory home equity to support a personal “living above my means” HELOC borrow and spend program. They have to own that problem.
According to the article, some housing experts have called for an end to government programs that they characterize as “extend and pretend” or “delay and pray.”
I couldn’t agree more.
Here is the full article from the Times: Housing Choice – Help Today’s Owners or Future Buyers