Monday, July 2, 2012
The Real Estate meltdown reasons
There have been many reasons attributed to the real estate meltdown. Greedy bankers, investors, buyers, speculators, opportunists etc. You can also add the television shows that showed people flipping houses like it was buying groceries. A few days ago I was watching a show from the height of real estate market and flipping was the thing to do, showing people making unrealistic profits. All these shows along with gargantuan profits that people were making made it seems like it was lottery with everybody winning. Some people were buying rundown and fixer upper houses, repairing and renovating them and then selling them at high profit. No wonder this party was going to end with a busted balloon. And now people whose houses are underwater and foreclosed or are on short sale have been blaming everybody but themselves. Look at the great state of Nevada, Florida, Arizona and California, all speculative real estate markets now struggling to recover from the meltdown. Untold millions of people have their houses foreclosed and short sale by the banks. The blame game is still going on but to put in perspective, nobody put a gun to people's head to buy a certain property, they did that of their own free will and now crying foul is like saying we were force fed into the housing frenzy. If you have seen my earlier post on housing reforms, you will see that a strict mechanism should be in place so that unqualified buyers should be given loans and full disclosure should be provided so that the potential buyers are under no delusion that what they are getting into.