Real Estate Investing:Housing Plan Stuck, National Recovery In Hands of Real Estate Market
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Article Content:
As the Treasury Department training company, Goldman Sachs, records incredible profits, the housing market is fighting a battle to save the economy. The 275 billion that the Federal Government allocated to infuse into the housing market is failing to get into the hand of the borrowers. It is staying with the bankers paying down their debt and fix their bottom line.
And if you are looking to buy an investment property, God bless you. With 2.1 million empty homes on the market, there is a great deal of excess inventory that needs to be absorbed before the market will have a firm foundation.
The group that could buy up this excess housing is the investor class to turn it into productive rental properties or fix them up (spending more money) and sell them. Instead the assets are sitting idle, a weight on the market and the economy.
Four months after President Barack Obama pledged 5 billion to shore up home sales, the engine that powered every U.S. recovery since 1960 is stalled. Bankers’ reluctance to finance buyers who won’t live in properties is one barrier to a turnaround. Stricter qualifying rules and a rise in the cost of residential loans to 5.42 percent have impeded new mortgage lending, which is at a 13-year low. An inventory of 2.1 million unoccupied houses on the market, created by the fastest foreclosure pace in history, may be a drag on a revival.