DEAN GRAZIOSI: DEAN GRAZIOSI REAL ESTATE

On October 2^nd of 2008 the Senate approved the largest bailout ever in the history of the world. With more than 25% of lenders in jeopardy the government stepped in to “save” the financial industry and home-buying markets.  On December 1^st, 2008, the foreclosure rates hit an all-time high and many homeowners were already too far behind on their payments to stop proceedings. 

           

The question on everyone’s mind is, “Where did all the bailout money go?”. Out of all the banks and lenders receiving aid from the bailout package, only 5% are passing the money on to the consumers directly. With the amount of money the government has injected into the big banks we could easily pay the next 4 months of delinquent home loans and allow the people to loosen their spending to stimulate the economy.

           

The Bush administration would be hard-pressed to find anyone not affected by the current home-buying market. With so many people losing their homes and having to regress to renting, the demand for rental properties has increased. Renters have noticed the change too. For example, in San Diego county, California, the average cost of renting a two-bedroom apartment has increased over $200 per month since the bailout was approved.  People who previously thought they wouldn’t have to pay for the home-buying market crash are now having to foot the bill with the people who could not keep up with their home loan payments.

           

With the 2008 holiday buying season over and no end in sight we must ask ourselves a few questions. Have we seen any ease of the foreclosure rates?  Has home-buying taken a turn for the better? Will the banks ever pass down the bailout to the consumers in any way? Would it have been better to let the market crash completely? How can we finally restore confidence in the banks and government that have been throwing our money at the problem to no avail?

               

This entry was posted on Monday, January 5th, 2009 at 11:45 am and is filed under Finanace, Investment, Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.