Housing Crunch

Over the past week, the news on the economy has not been good. For employment, job growth ground to a complete halt last month, gaining no new jobs. The employment-population ration fell to 58.2% (9/3/11 Wall St. Journal) and the unemployment rate stayed high at 9.1%. Bank of America announced that it may ax 30,custom bobbleheads,000 � 40,000 employees, and Deutsche Bank is moving in the same direction. As one can plainly see,Short Beach Wedding Dresses for Your Big Day,custom bobbleheads, the income and job security of the average American certainly isn�t going up.

Now let�s look at the consumer savings and debt side. One piece of positive news is that household debt loads are shrinking. However, mortgage debt as a percentage share of home values is sky-high, and nearly double what it was 25 years ago (9/8/11 WSJ). Close to one in three American adults who grew up middle-class are now on a lower income rung (9/1/6/11 Washington Post).

In the not so distant past, people in their 50�s and 60�s could get their mortgages paid off by this point in their life so that they could prepare for retirement. That is no longer the case. About 39% of households with heads ages 60-64 had mortgages on their primary homes in 2010,custom bobbleheads, nearly twice the 22% in 1994.

Overall, consumer incomes are stagnant,Personalized Face Consultation,., savings are low, and debt levels are still high. Surely,custom bobblehead, the government is putting in place a long-term plan to get America to a sure financial footing, right? Alas,Bridesmaid Dress for Vintage Wedding, that is not the case.

Besides the current debt which the U.S. has no way to pay down,personalized bobble heads, last Thursday the President opined that there should be $447 billion (nearly half a trillion bucks) in spending initiatives and tax cuts. If you look at recent programs like the buying of toxic assets from banks, various foreclosure relief programs,customized bobbleheads, home buyer tax credits, cash for clunkers, etc.,custom bobblehead, it�s clear that neither the administration nor Congress have a clue about how to solve the problem, so they throw more money into the air with the hope that something good will happen.

Basically, none of this is good for housing. When potential buyers have no money to buy and banks are stingy about lending,customize bobblehead, the home values and sales have nowhere to go but down. The average rate on a 30-year fixed mortgage dropped to 4.12%, which is a record low,personalized bobble heads, and still is not enough to crank up home prices.

Of course,,, owner financing can help in some situations. If a house seller owns a property free and clear or has a low balance on their mortgage,Spring Junior Bridesmaid Dresses Trends, then creating up a mortgage note and perhaps later selling that mortgage note to a mortgage buyer can make sense. However,custom bobblehead, owner financing is generally not a good fit if the owner is carrying a heavy mortgage.

Month after month, the economic news seems to get worse and the politicians less capable. Nobody knows how this will all end, so keeping an eye on the always changing economic landscape is the best approach, as no miracles are likely to appear.