Capital Commerce

No Need for Obama's Housing Bailout?

March 1, 2009 RSS Feed Print

What this chart (via Jim Glassman at JP Morgan Chase) says to me is that housing is now undervalued. And, as Glassman expains, "even if house prices continue to fall, don’t be so sure that defaults will worsen, because the weak hands—speculators—by now have been washed out. Folks who actually live in their houses and can make their payments don’t turn their keys back to lenders, just because prices are down.

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Good article. As I've mentioned in my blog (www.moneybymark.com), statistics can be made to read anything you want. He also makes a point that I've said in my book, if you don't sell your house and plan on staying in it, what does it matter in the short term? Values will go up someday, unless we have a complete collapse in the USA, but how much will be based upon supply and demand. The loan will be paid by those who can and it will be no problem. I don't like the "paper" losses that I've incurred anymore than anyone else, but I've chosen when to buy and sell just like everyone else.

Mark of TX 1:29PM March 02, 2009

James-you're in a tough spot and it is emotional for you. Jimmy P is trying to be analytical. The market has made a big shift quickly while the government dithers. Markets are healing and these are some of the signs. As hard as it si for you it is not the end of the world. As soon as the majority can sense that the rest of the healing, both markets and psyches, can come.
Obama can't save anyone from the economic truth.

Pat of IL 10:35AM March 02, 2009

You sir, bought a house at the top on the market and paid more than the home was really worth hoping that it would keep going up and up. And you did this while on or going into a fixed income situation. This was a bad decision on YOUR part no one else's.
Now the big question is what do you want now? Do you want the taxpayers of America to make up for your poor business decision? I do feel for you but it is not my responsibility, it's yours.
The chart is very informative and tells the facts about the market, not the emotion.

Larry of CA 10:26AM March 02, 2009

No Need for Obama's Housing Bailout?

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