Throughout the United States we have seen the value of houses plummet
Granted, that house prices were a bit inflated before the bubble burst; but there is no excuse for someone who bought a property at a certain price and now it is only worth half of the price that was paid for it.
You see, that loss in value translates into a profit for somebody…either in Wall Street or a bank, and there are no signs that it is going to get better any time soon.
For most people, that is the 99% of us who are not wealthy, our homes comprise most of our life savings and our only source of accumulated wealth. If you destroy that, you have made all of the homeowners in the country poorer…and these are mostly middle class folks.
If you were unfortunate enough to be caught up in the scheme of banks to foreclose on your property then you have absolutely no excuse to vote for Republicans who caused your loss. Perhaps it was the loss of your job or an obscene medical bill that made you default on your mortgage…or perhaps the price of your home went down so much that you are in an upside down situation…whatever the reason, don’t forget that the banks and Wall Street got bailed out and you didn’t.
“67.6 percent of U.S. households own their home. The housing situation is very much a majority issue for average Americans. This is where most Americans store their wealth. 51 million households have a mortgage while 23 million live in homes with no mortgage at all (approximately 30 percent). Let us run the numbers for someone looking to buy a home today with a FHA backed loan since this only requires a 3.5 percent down payment. Here are the numbers:”
“Now many would argue that the rise of the two income household has pushed home prices up. But you can easily argue that it now takes two incomes merely to have what those in the 1950s and 1960s had. Of course this comes from the insidious ability of the U.S. Treasury and Federal Reserve to siphon off the earning power of average Americans and give massive handouts to the banking industry. And that is exactly what occurs. Look back up at the mortgage calculation chart. Aside from the monthly payment, notice something else? The “cost” of that cheap 5.85 percent mortgage is going to run you $187,176 after 30 years. In other words, the interest you pay is more than the actual home price. Now if banks are borrowing near zero from the Fed why not allow average Americans to borrow directly from the Fed since virtually every mortgage is now guaranteed by the taxpayers? Because interest and fees, unproductive aspects of our economy are being taken from the banking industry and suffocating the balance sheet of average Americans.
Home prices have gotten more expensive because the crony banking system is hungry for more and more profits. If banks had to lend their own money, home prices would automatically adjust lower. Is that necessarily bad? This would provide more mobility and less of a focus on homes as commodities and more as a place of shelter. Take for example the current bust. Say someone in struggling Detroit finds a job in New York but can’t sell his home. Say that new job utilizes their skills more effectively. How is their inability to move helping the overall prosperity of our economy? It isn’t. Yet this is the position millions now find themselves in.
I would argue that homes are still very expensive yet the propaganda is flying from the banking industry because they want people to buy homes even though they can’t afford them. Ironically cheaper home prices would help our economy in the long term but this would cut into additional banking profits since they currently hold over priced real estate, both residential and commercial, and want to off load the waste at peak prices to the taxpayer. The corporatocracy has caused more and more damage to our economy and inflating home prices has been one of the outcomes of giving too much power to the financial sector.
In the 1950s and 1960s when our economy was relatively healthy and booming home prices cost about twice the annual median income. That number sounds about right even for today. Yet the propaganda is strong and many simply want to believe that a big drop in prices means homes are now cheap. Don’t believe it.”
So, keep this in mind when you get to the voting booth in 2012 and don’t elect one single Republican…not even for dog catcher.
SOURCE: http://www.ritholtz.com/blog/wp-content/uploads/2011/04/2011-Case-SHiller-updated.png
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