First, I'll preface this highly-personal entry by saying, I am not the most political person (nor always politically correct). I can also state quite confidently I am not an economist. However, I do sell houses for a living and believe some people respect my opinion as to whether it is a good investment to buy (or sell) a home in this volatile economy, or do they stay where they are at, hoping things will settle down soon.
That said, I believe that if our government steps in and effectively eases the bank stress created by overly-greedy, law-bending mortgage bankers (who all should be held personally and financially responsible for the unbelievable pain - and sometimes outright fraud - caused to the trusting purchasers of homes), our economy -- read: real estate market -- will become a viable long-term investment for families once again. However, I believe we should not try to create a short-term quick-fix, as indicated by the Bush-led administration: http://www.msnbc.msn.com/id/26871338/?GT1=43001. BTW, I am not Republican (registered Democrat) but I also don't trust the incoming Democratic ticket. Let's just say I'm a member of the "Character" political party - if a politician shows they vote for the general public's well-being and long-term solutions instead of special interests, you'll get my vote (religion, race, sex mean nothing - only character should count in politics). I digress... Back to real estate.
I believe our publically-voted-in legislators need to create a long-term answer by shoring up mortgage lenders proven to be using legal and ethical business practices over the past decade. But I don't think we'll see a true, long-lasting answer until after this upcoming November election. I believe our legislators should also hold accountable all mortgage banks and loan brokers who have used questionable and unethical business practices over that same decade and return the lost funds to the people who made those gargantuan payments to these leeches. "Golden parachutes" for outgoing executives who created this mess while hard-working, honest middle-class homeowners go bankrupt, are left homeless and penniless, is horrific and completely inexcusable. "Concrete jail cells" is more deserved. If any of our legislators vote to exonerate these self-absorbed, greedy executives, I believe the next political cycle will be the next thing needing a governmental bailout in the form of a good, old-fashioned swift kick in the ***.
So... should I buy a house during this governmental bailout? Yes. Interest rates are terrific (6.0%, fixed 30-year - Mortgage First 9/22). Inventory is plentiful (nearly two year supply of active listings). And, unless the government steps in and completely absolves every debt on record, there will be plenty of sellers looking to sell so they can buy the next step up. This wonderful step will create a chain reaction called "real estate sales" which will increase demand, shrink supply, stimulate building again, and level out our economic downturn. Real estate appreciation is forthcoming.
Have a great week!! :-)