Two thousand eight is important for several reasons. For starters, many are keeping a very close eye on the real estate market to see what direction it will take and whether the NAR predictions of a slow recovery hold true. But even more important than that, this year will also determine the person who will be running the country for the next four years, also known as the president of the United States. Presidential candidates Barack Obama and John McCain each have their unique strategies to get the housing market out of its tailspin, let’s take a look.
McCain believes that by pumping more than eight billion dollars into a mortgage fund, homeowners could “trade in” those adjustable rate mortgages that have lead to so many foreclosures and instead receive one with fixed terms, forcing payments to remain steady. Additionally, several tax cuts should be implemented during certain periods when there is peak consumption (i.e.: gas during the summer) with the intention of giving homeowners a bit of a financial break.
Obama also intends to establish a multibillion dollar fund, the difference being that his proposal would be specifically intended to stop foreclosures. Obama is also proposing amending mortgage rules in favor of homeowners. Instead of finding themselves with no choice but to foreclose, homeowners would be able to tweak the terms of their mortgage in order to reach a mutually beneficial payment agreement. Considering the damage done by poor bank lending practices, the Federal Reserve should also be allowed more control over their actions.
For the time being we can only speculate on which of these two strategies will prove more effective in fixing the mortgage fiasco and setting the real estate market back on its proper course. Your own political beliefs aside, does one of the proposed ideas come across as more effective than another?
