What needs to be done now to fix the real estate market?

Asked by Brian Halstead, Miami, FL Tue Nov 9, 2010

Well many believe there is not much that can be done, in fact some say it is just another economic cycle and the market will right itself but was the present condition we are now in unduly influenced by unrighteous greed and if so could just leaving it cause more harm than good?

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Charles Husen, , Pleasant Hill, CA
Tue Nov 9, 2010
Hi There Brian, Thanks for your question.

Our economy is sick and it needs to heal. We have spent the last 15 years borrowing more money than we earned and used this borrowed money to speculate. Every asset class in this country is overpriced in relation to historical fair value. Anyone that suggests an easy fix is ignoring the problem.

We must get back to working and saving. Our nation can't continue to borrow money and speculate. We can't continue to play financial casino games.

1) As a nation, we need to stop living on debt.
2) Housing, stocks and bonds need to bottom at a fair value in relation to household income, rents and GDP.
3) We need to reduce the size of the government and the financial sector and get back to producing.

This will take some time and some pain but once we quit playing economic games and start to focus on working and saving our nation will return to the prosperity of the past. Thinking that we can continue to pump up a bubble economy forever is childlike.

Charlie Husen
Tax Home Realty
Web Reference:  http://www.incometaxhome.com
3 votes
Mack McCoy, Agent, Seattle, WA
Tue Nov 9, 2010
All economic cycles are fueled by greed, or shall we say, it's just never enough for some people.

The real estate market will take care of itself if we put ten million people back to work earning at least $35,000 a year. People have to make a living wage and be able to afford a few luxuries in addition to the basics for the real estate market to get better.

We can't afford tax cuts, but we actually can afford tax hikes. I'm thinking 40% on each dollar over a million, 50% over three million, 91% over twenty-five million. Better than under Eisenhower. And that's on net taxable income, after deducting all the business trips and other goodies. Tax shelters are good, they're investments. Alex Rodriguez, go invest in a winery.

We raise taxes on corporate profits, and allow them credits for new hires over a threshold. And a transaction tax on securities trades; there's no reason in the world that computer churning of stocks should create hundreds of billions of dollars in profits for "traders," who then walk away with billion dollar bonuses.

Over the past ten years, the middle class has lost ground, the richest 1% have grabbed an even bigger share of the pie, Rather than a futile battle to make them give it back, we need to expand the pie for everybody. Ninety-one percent, that's my new number!
2 votes
Gerard Dunn, Agent, Chevy Chase, MD
Tue Nov 9, 2010
I believe we need to instill confidence in the consumer that the real estate market is secure.

I believe that the pendulum has swung too far to the conservative side regarding financing. Limited Documentation loans with large down payments and stellar credit will allow the self employed to purchase more easily.

Note - I said with large down payments and stellar credit.

Just one man's opinion!

Good Luck -

Gerry Dunn
Associate Broker
Maryland, Virginia and District of Columbia

2 votes
Alma Kee, Agent, Tampa, FL
Tue Nov 9, 2010
We need:

FairTax.org - people will have more money on each paycheck. Everyone will pay their "fair" share based on whether they're purchasing a yacht or a used Honda.

Take FairTax one step further and eliminate all Corporate income tax, too. That way those companies who went offshore will now return to the US and provide much needed jobs.

Allow FAST TRACK immigration to high net worth individuals with a minimum of $200k liquid net worth and require them to purchase a minimum o$100k property within 6 months of immigrating.
1 vote
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