Uh-oh: Obama says he feels Las Vegas' housing pain
It's nice to know he cares about us. The problem is he wants to use taxpayer money to subsidize people who are having problems with their mortgages.
The White House refinancing plan was an improvement in that previously loans backed by Fannie Mae and Freddie Mac needed to have 20 percent equity to qualify for refinancing.Last week Titus, Berkley and other House lawmakers sent a letter to Geithner saying the additional funding could "help more principal homeowners in severely affected areas to stay in their homes."
Still, Titus, and more recently Senate Majority Leader Harry Reid, have urged the Obama administration to loosen the equity requirement, arguing that with unemployment now at 11.6 percent, refinancing could help avoid foreclosures.
Opponents, however, have warned that taxpayers will hold the bag if homeowners default on the refinanced loans. Fannie and Freddie are essentially backed by the government.
Plus, politicians risk populist unrest over bailout fatigue.
Obama was well aware of the problem facing Nevada's underwater homeowners, but not ready to commit to its solution.
"I know one suggestion that has been made is to further drop the equity requirements," Obama said Wednesday. "I don't want to weigh in yet because I haven't seen the conclusions from Treasury about how that would impact the program, if it would cost additional money to taxpayers in order for us to get the banks to play along with it ... I just want to see what works within the constraints of the resources that we have."
Obama did indicate, however, that bank bailout money is being eyed for housing - a move supported by Titus, Reid and Rep. Shelley Berkley.
"If those resources are now available and can be recycled in even more help for homeowners, that's something that is worth considering," Obama said.
Life would be so much simpler (and better) if politicians wouldn't pick the winners and losers in an economy.
The actions of Titus, Berkley, Reid and Obama are especially regretable, because the housing market is finally starting to bottom out after the housing bubble burst.
Sales of existing homes increased for the fourth straight month in May and signs of a price bottom are starting to appear, Las Vegas housing analyst Dennis Smith said Wednesday.Just another simple case of supply and demand.
"It could be. Let's get through the summer before we say anything," the president of Home Builders Research said. "It's hard to predict or analyze how to get through the new inventory you hear about of 20,000 foreclosures that haven't hit the market yet."
Home Builders Research reported 3,714 resales in May, a 42.5 percent increase from the same month a year ago and up from 3,652 in April.
For the first time in more than a year, the median price was unchanged from the previous month at $130,000. It's still down 43.5 percent, or about $100,000, from a year ago.
Total resales for the year are up 61 percent to 15,728, an amazing statistic considering all the negative reports bombarding the public almost daily, Smith said.