Comments on: Home market isn’t on rebound yet Fri, 05 Dec 2014 11:27:18 +0000 hourly 1 By: TFF Mon, 21 Mar 2011 00:54:55 +0000 “The first is to allow immigration to any otherwise qualified person if they purchase a home meeting certain standards, provided they purchase it entirely for cash.”

An interesting idea — very different from our present system in which we have effectively unlimited illicit immigration, but mostly individuals with no education or money.

“Second, allow a single residence to be exempt from all taxation (e.g., real estate taxes), provided that the contiguous land area is below a specified size.”

Property taxes are the primary funding source for schools and local services. Can you think of a fairer way of raising that money? (I can think of several, but there is huge momentum behind the present system.)

Demand isn’t going to rise until prices fall substantially. You can reasonably afford to buy a home that costs 3x your annual salary, but many people were stretching for 5x, 8x, or even 10x… That’s when you get into trouble.

In some countries, real estate is largely cash-transfer. I do appreciate the societal value of being able to take a low-interest mortgage, though I agree with you that this principle was taken WAY too far. There really is no need to offer anything greater than 80% LTV. Don’t have the downpayment? Rent for a few more years…

By: TFF Tue, 15 Mar 2011 00:12:16 +0000 johnwasik, corporations write down the value of their *assets*. For a homeowner, the mortgage is a *liability*.

It is pretty rare for a corporation to reduce the value of its liabilities. That is known as “default” and typically only happens in “bankruptcy”, at which point the creditors seize control of the corporation.

You are welcome to write down the value of your house in Quicken, but you still owe the original balance on the mortgage.

By: LeePutnam Mon, 14 Mar 2011 19:13:12 +0000 The article states: The states’ proposal would allow homeowners to write down principal balances while renegotiating mortgage terms. ………….

and then the article states:

Congress has failed to allow mortgage holders to write down balances in bankruptcy court, so this could provide some buoyancy for the ever-sinking housing market.

This article makes an assumption that letting a group of underwater homewaters write down principle will then create a bottom and add buoyancy. What I don’t understand is why so few “official” and folks who sound like experts never explain the other assumption. That is once a few homeowners get principle write downs then the remaining 15 million underwater homes will want and deserve the same principle write down and if they don’t get it will all walk away. The power of the internet will allow all 15 million to share information and a time and date to stop paying their mortgage.

I am so tired of congress wasting this precious time considering principle write downs. It is a no go option.

Any option needs to be fair to all in America or just let the things fall as they are now. The only thing the government should be doing today is making it OK and even supporting homeowners to walk away before they spend their last dollars including retirement, children’s education savings etc. before doing the inevitable anyway.

By: johnwasik Mon, 14 Mar 2011 13:06:32 +0000 As I’ve noted in earlier columns, corporations are allowed to write down values of depreciated assets all the time. Why not homeowners? I think HAMP is a failure, but doesn’t mean that Fannie and Freddie should be entirely eliminated. Maybe downsized. It’s hard to tell what the right course is with the market so dismal.

By: breezinthru Sun, 13 Mar 2011 04:06:39 +0000 A lot of people had mortgages they could afford, but when they were suddenly worth much less than the remaining balance it just didn’t make sense to keep on paying for it.

By: Laster Sun, 13 Mar 2011 01:00:27 +0000 I would offer that anyone who would be able to “Lop $100k” off their balance, to come in line with current market value, would not have been one of those poor people who purchased more home than they could afford.

By: NewsLady Sat, 12 Mar 2011 23:25:39 +0000 So “it’s only fair” to allow people who took on mortgages they couldn’t afford in the first place to lop, say $100k off the balance, because after all, their home is worth that much less than when they bought it, right?

Gee, I think I’ll go out and buy a million-dollar house. Because values will probably slide another 20 percent, and when that happens I’ll just have my Uncle Sam slash $200 grand off my mortgage. Let the hardworking taxpayers who’ve kept up payments on homes they could afford pick up the tab. Assuming there are any left.

You talk about the government “keeping people in their homes,” as though people were little government pets to be sheltered and fed instead of being responsible for their own lives.

Ask yourself this: Are we as a nation better off or worse off with government programs like bankrupt Fannie and Freddie (you could call their function “getting people into homes”) and the money-printing machinery behind them? What does the future hold for these programs? And for our national balance sheet?

Are government housing programs really the solution? Or would we be better off without them?