{"id":6950,"date":"2009-02-19T09:30:58","date_gmt":"2009-02-19T16:30:58","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=6950"},"modified":"2009-02-19T09:32:27","modified_gmt":"2009-02-19T16:32:27","slug":"the-bad-news-obamas-housing-relief-plan-is-a-giveaway-to-lenders-not-homeowners-the-worse-news-it-wont-work-anyway","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/6950\/the-bad-news-obamas-housing-relief-plan-is-a-giveaway-to-lenders-not-homeowners-the-worse-news-it-wont-work-anyway\/","title":{"rendered":"The bad news: Obama’s housing relief plan is a giveaway to lenders, not homeowners. The worse news: It won’t work, anyway."},"content":{"rendered":"

If you read the news this morning, you’ll find Realtors all over the country rejoicing that President Obama has surged into the depressed real estate market on a white charger, bearing with him an heroic plan to rescue everyone — borrowers, lenders and especially Realtors. No discouraging words? To the contrary. Some Realtors think Obama’s promise of $275 billion in mortgage bailouts does not go far enough.<\/p>\n

Here are two important questions to put the matter into perspective:<\/p>\n

1. By how many dwellings will the standing inventory of housing be reduced under Obama’s plan?<\/p>\n

2. By how many households will Obama increase demand for housing?<\/p>\n

Since the answer to both of these questions is zero, we can predict with certainty that President Obama’s housing relief plan will do nothing to relieve the housing crises.<\/p>\n

What will<\/em> it do? The true essence of the plan is Rotarian Socialism for lenders. Obama’s hope — probably hopeless — is that if lenders take a lot of small hits now — by refinancing homes for substantially less than is owed on them — they can avoid a lot of much bigger hits later — by not having to foreclose on those homes.<\/p>\n

But the real problem — in Phoenix, Las Vegas, Sacramento, South Florida, the Rust Belt, etc. — is that the residential real estate market is overbuilt. There are more houses seeking homeowners than there are homeowners (or tenants) seeking houses. The real estate crisis will not end until supply is reduced, demand increases — or both.<\/p>\n

Obama is trying to shove a floor under home values. But since this does nothing to correct the systemic<\/em> problem — oversupply — he is simply pissing away money while delaying the ultimate and unavoidable market correction.<\/p>\n

Want a true<\/em> housing relief plan?<\/p>\n

Here in Arizona, we could do ourselves a huge favor by repealing the employer I.D. check law that drove all of our undocumented friends out of the state — just at the wrong time.<\/p>\n

And it would make great sense to make immigration to America easier and faster. Imagine having neighbors who work hard, pay their bills on time and can spell correctly!<\/p>\n

But those Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

If you read the news this morning, you’ll find Realtors all over the country rejoicing that President Obama has surged into the depressed real estate market on a white charger, bearing with him an heroic plan to rescue everyone — borrowers, lenders and especially Realtors. No discouraging words? To the contrary. Some Realtors think Obama’s […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[251,29,26,6,5],"tags":[],"class_list":{"0":"post-6950","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-big-mother","7":"category-group-therapy","8":"category-lending","9":"category-marketing","10":"category-real-estate","12":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":7018,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/7018\/obamas-housing-rescue-plan-wont-rescue-housing-but-it-will-delay-the-eventual-recovery-of-the-real-estate-market\/","url_meta":{"origin":6950,"position":0},"title":"Obama’s housing rescue plan won’t rescue housing, but it will delay the eventual recovery of the real estate market","author":"Greg Swann","date":"February 21, 2009","format":false,"excerpt":"This is my column for this week from the Arizona Republic (permanent link). \u00a0Obama's housing rescue plan won't rescue housing, but it will delay the eventual recovery of the real estate market President Barrack Obama came to Mesa Wednesday to announce his new housing initiative. The location made for good\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":7171,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/7171\/what-if-they-reduced-a-tax-deduction-hardly-anybody-gets-if-youre-the-fib-spinning-pinocchio-at-the-national-association-of-realtors-your-whole-make-believe-world-just-collapsed\/","url_meta":{"origin":6950,"position":1},"title":"What if they reduced a tax deduction hardly anybody gets? If you\u2019re the the National Association of Realtors and you’ve been spinning lies for decades about mortgage interest deductibility, your whole make-believe world just collapsed\u2026","author":"Greg Swann","date":"June 9, 2010","format":false,"excerpt":"Kicking this back to the top. It's news again. I wrote this post more than a year ago, but, per The Hill, the tax-deductibility of mortgage interest is back on the table:The popular tax break for mortgage interest, once considered untouchable, is falling under the scrutiny of policymakers and economic\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":14590,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/14590\/more-thrilling-real-estate-math-from-the-national-association-of-realtors-how-much-did-first-time-home-buyers-benefit-from-their-8000-tax-funded-subsidy-can-you-count-to-negative-15000\/","url_meta":{"origin":6950,"position":2},"title":"More thrilling real estate math from the National Association of Realtors: How much did first-time home-buyers benefit from their $8,000 tax-funded subsidy? Can you count to negative $15,000?","author":"Greg Swann","date":"May 11, 2011","format":false,"excerpt":"You read that right. On average, recipients of the $8,000 federal housing subsidy lost $15,000 on the homes they purchased using the subsidy as their incentive. From SmartMoney.com:The government's recent $8,000 cash incentive for first-time home buyers has proved even more costly for recipients than for taxpayers, according to data\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":4852,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/4852\/its-a-great-time-to-be-a-realtor-or-a-lender-if-youre-a-good-one-at-bloodhoundblog-unchained-in-orlando-youll-learn-how-to-dominate-your-market-in-the-dark-days-ahead\/","url_meta":{"origin":6950,"position":3},"title":"It’s a great time to be a Realtor or a lender — if you’re a good one. At BloodhoundBlog Unchained in Orlando, you’ll learn how to dominate your market in the dark days ahead","author":"Greg Swann","date":"October 8, 2008","format":false,"excerpt":"What came out of last night's Presidential debate? No matter who wins, we all lose. As painful as it might be to suffer a quick drop in housing values, followed by a recovery, we are in for a much more extended agony. Whether Obama wins in November or McCain, we're\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.paypal.com\/en_US\/i\/scr\/pixel.gif?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":16298,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/16298\/apparently-insanity-is-buying-the-same-house-over-an-over-again-even-though-you-never-qualify\/","url_meta":{"origin":6950,"position":4},"title":"Apparently, insanity is buying the same house over and over again, even though you never qualify.","author":"Greg Swann","date":"April 3, 2013","format":false,"excerpt":"You just can't make this shit up: Obama administration pushes banks to make home loans to people with weaker credit. Why not? It worked out so well the last time.The Obama administration is engaged in a broad push to make more home loans available to people with weaker credit, an\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3185,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3185\/whos-a-mortgage-fiduciary\/","url_meta":{"origin":6950,"position":5},"title":"Who’s a Mortgage Fiduciary?","author":"Brian Brady","date":"May 31, 2008","format":false,"excerpt":"Are you ready for the next big argument about fiduciary capacity? It's coming in the form of national loan originator licensing and it promises to be a doozy. The Federal Housing Finance and Regulatory Reform Act of 2008 is proposed legislation that seeks to license anyone who quotes rates or\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/6950","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=6950"}],"version-history":[{"count":1,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/6950\/revisions"}],"predecessor-version":[{"id":6951,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/6950\/revisions\/6951"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=6950"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=6950"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=6950"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}