Fixing the Housing Market Essay

The housing crisis of the late 2000s rocked the economy and changed the landscape of the real estate business for years to come. Decades of people purchasing houses unfordable houses and properties with lenient loans policies led to a collective housing bubble. When the banking system faltered and the economy wilted, interest rates were raised, mortgages increased, and people lost their jobs amidst the chaos. This all culminated in tens of thousands of American losing their houses to foreclosures and short sales, as they could no longer afford the mortgage payments on their homes. The United States entered a recession and homeownership no longer appeared to be a feasible goal as many questioned whether the country could continue to support a middle-class. Former home owners became renters and in some cases homeless as the American Dream was delayed with no foreseeable return. While the future of the economy looked bleak, conditions gradually improved. American citizens regained their jobs, the United States government bailed out the banking industry, and regulations were put in place to deter such events as the mortgage crash from ever taking place again. The path to homeowner ship has been forever altered, as loans in general are now more difficult to acquire and can be accompanied by a substantial down payment.

Article 25 of the Universal Declaration of Human Rights asserts that housing is a fundamental component to a decent standard of living, yet few city governments--even in the most developed economies--have proven themselves capable of ensuring such a basic right to their constituents (United Nations, General Assembly). Ranked 49th among the 50 U.S. states for its number of housing units per capita, California has notoriously struggled with chronic shortages in its urban housing market. With 118,142 homeless people recorded in 2016, California holds almost 22% of the nation’s homeless population (Fact Sheet: Homelessness in California 1).

The housing crisis in Detroit illuminated the grave economic reality of migrant black families living in the industrial Midwest. In order to holistically analyze the ramifications of the black labor movement, historians must understand the inextricable link between fair housing and the lack of financial capital for generations of black families. The rise of surbanization and red-lining tactics prompted white flight from Detroit’s predominately white neighborhoods, such as Dearborn. “During and after World War II, blacks flooded into Detroit’s Lower East Side: Paradise Valley” (Sugrue 36). Neighborhood deterioration, coupled with disproportionately high-rents and low Home Owners Loan Corporation appraisal scores, led to private-sector discrimination practices by predatory bank loaners and real-estate brokers in the West and East-Sides of Detroit—particularly the Eight-Mile, Paradise Valley, Oakwood, and Sojourner Truth Housing areas (Sugrue 43, 77).

Affordable housing in the United States describes sheltering units with well-adjusted housing costs for those living on an average, median income. The phrase usually implies to applied rental or purchaser housing within the financial means of lower-income ranges specific to the demographics of any given area. However, affordable housing does not include those living in social housing owned by government and non-profit organizations. More specifically, the targeted range for housing affordability sets below 30 percent of a household's annual income, including all applicable taxes, utility costs and home owners insurance rates. If the mean income per household breaches the 30 percent mark, then the agreed status becomes labeled as

In 2007, the U.S. fell into a deep financial recession. One of the main causes of this was the bursting of the housing bubble, which lead to a housing crisis. What is a housing bubble? A housing bubble is defined as “a temporary condition caused by unjustified speculation in the housing market that leads to a rapid increase in real estate prices” (businessdictionary.com 2014). When the bubble bursts, the result is a quick decline in home prices (businessdictionary.com 2014).

The mortgage crisis we are experiencing in the United States today is already ranking as among the most serious economic events since the Great Depression of the 1930’s. Hardly a day goes by without a story in the newspaper or on the cable news stations reporting about the increase in the number of foreclosures across the United States. The effects of this crisis have spread across all financial markets, where in the end all of us are paying a price for this home mortgage crisis. When the housing market collapsed, so did the availability of credit which our economy depends upon. The home mortgage crisis, the financial crisis and overall economic crisis all need to address by the

The foreclosure crisis in America has impacted everyone- even those who don’t own homes. Our nation is currently struggling with high unemployment, a relatively illiquid credit market, and a deficit that raises serious concerns about the value of the US Dollar in the not too distant future. With interest rates already at historic lows and the government pursuing an unprecedented policy of quantitative monetary easing, options for government intervention are limited. While there is no simple solution to this problem, I think that we must look at the reasons the housing market went into crisis, and based on that develop a regulatory system that will allow us to avoid another situation like this in the future. If Americans believe

Big banks in the middle 2000s were flourishing of the money made from selling the mortgages to big investors. While this was great when the banks were giving money to people who were reliable and were going to pay their mortgages every month. And when the investors were making such a hefty profit they wanted more. This is when Subprime mortgages were widely used, giving less reliable lower credit scores the opportunity to get homes. The banks knew that these people would not necessarily always be able to pay, which was the one of many mistakes (Crash Course.) The banks learned that while it did sometimes work out, the consequences of giving out too many unreliable mortgages can bring the whole nations economy down for the housing market has always been the pillar of the economy. The greed of the extremely wealthy continued to overpower the common sense of the

The housing crisis in the late 2000’s was created in part from subprime loans that lenders gave to individuals that did not have to provide proof of income that they could afford the house. This was a disaster likely to repeat itself. If a person is hoping to buy a home, they will buy whatever the lender allows them to purchase even though it could be a financial stretch. Lenders, builders, sellers, appraisers, buyers, owners, and governmental policy makers are all still gambling with the economic future of both their buyers and the American economy as a whole.

Within the past three to four years, the United States has seen the dramatic collapse of the housing market. The housing bubble spurred by ill-advised loans to individuals who could not afford a mortgage, complicated contracts which had interest rates and payments changing without reason, and the mass purchasing of bad loans by lending superpowers, had popped. The rapid increase in the value of homes across the country for the previous decade, had been a falsity, in which billions of dollars funded by investments and home purchases were lost within a few months (Wikipedia.org: United States housing bubble). Millions of home owners were found to be unable to pay their mortgages, leading to hundreds of thousands of foreclosures. These

As the saying goes, history repeats itself. The Great Depression is a time in American history that will always be remembered as a time of hardship in Americans’ lives. The goal: to never have such great oppression exist in the United States again. With the way the economy is headed today, many people are skeptical as to whether history will really repeat itself and create a new Depression. One of the biggest problems in the country today is the foreclosure crisis. Many Americans are living outside of their means or have lost their jobs and are unable to make their mortgage payments. When people can’t make their mortgage payments, they will lose their home and their family will be out on the streets. There are definite changes that need to

Housing affordability is a perennial problem in Australia and has worsened significantly over the past three decades.

The United States economy has been in trouble for the past couple of years. The foreclosure crisis is a condition that began due to the inability of homeowners to pay their mortgages. Foreclosure is a legal proceeding whereby a lender obtains a legal termination of a debtor’s right to redemption. The foreclosure rates have been increasing for a considerable period and certain steps have been put into place to solve the problem. While the government, financial institutions and the general public are highly aware of the crisis, the steps taken to combat the problem are still not sufficient as the foreclosure rates are still increasing.

Interest rates have a major economic impact on the real estate market. Interest rates directly affect property sales. Residential property realizes the greatest affect as interest rates have a considerable influence on a homebuyer’s capability to purchase a new property. The customer is affected when there are significant increases or decreases in interest rates. Declining interest rates lower the costs of obtaining a mortgage; this in turn creates higher demand for homes, and pushes home prices up. Conversely, high interest rates increase the costs to obtain a mortgage; these increases lower the demand for homes, which creates a decline in home prices. (Stammers, 2016)

The current real estate crisis that America finds itself in is one of the greatest challenges America has ever faced. America’s troubles are further compounded by increasing unemployment of American citizens and environmental problems like global warming. Solving any one of these problems would be a Herculean task, yet they must each be addressed in order to protect American families from disaster. However, it is possible to find a solution to the problems of the real estate crisis that can also be used to improve the problems of the unemployment and environmental destruction. The first part of the solution involves the United States government purchasing the homes that have been foreclosed and using them to offer temporary housing to