Personally I think that it is going to be helpful in stabilizing the real estate market. Moreover, the additional support for Fannie Mae and Freddie Mac, which are other provisions in the legislation, will help to avert a further down slide.
I also support tightening regulations on mortgage brokers to help avoid the widespread predatory lending practices that are now being prosecuted. Many borrowers were told at the last minute at the closing table that the fixed rate mortgage for which they had applied and been approved was "pulled at the last minute" and that the borrower was being offered a ARM loan. Of course, they were sitting there with their moving truck on the way to the new house. When those ARM loans escalated above the initial teaser rates, and property values declined, they were upside down in a mortgage they could no longer pay. These situations have fed the short sale and foreclosure problems. Granted, we also had over investment because flipping had been so profitable for several years. At any rate, there are many affordable homes right now, and the $7500 credit should increase the buyer pool, reduce inventory, and gradually stabilize the market. What is your opinion?
Have you read the Barron's Magazine article about the Case-Shiller Report on the real estate market? It is quite scholarly and easily available online. They predict mid 2009 for the beginning of recovery. Read the reasons why.