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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: THE ANT who wrote (65711)	8/24/2010 4:35:03 PM
From: elmatador	Respond to of 218043

US houses dropped 30% since 2006 peak. gobankingrates.com What the article is a localized thing: Paulistas are a very aggressive lot. São Paulo (the city) is fast running out of space. Other case is coastal areas. prices going up faster than the rest of the country - barred S.Paulo- because of off shore oil effect.

To: THE ANT who wrote (65711)	8/24/2010 4:47:49 PM
From: elmatador	Respond to of 218043

A post-WWII push Before World War II, would-be home buyers faced huge obstacles. Banks demanded 50% down payments for mortgages that would last just five or six years; then, the homeowners would have to cough up the balance in a balloon payment. Homeownership remained mired around 40%. Then came government support for homeownership through Fannie, Freddie, the Veterans Administration and the Federal Housing Administration, a government agency that insures mortgages. The new long-term, fixed-rate mortgages, encouraged by Fannie and later Freddie, made housing payments affordable to ordinary families. The mortgage interest deduction, which cost the Treasury $80 billion in 2009 alone, made homeownership even more attractive. Housing has an enormous impact on the economy: Harvard University's Joint Center for Housing Studies reports, for instance, that cutbacks in home building and remodeling slashed a full percentage point off economic growth in 2007 and almost that much in 2008. But urban studies specialist Richard Florida, author of The Great Reset: How New Ways of Living and Working Drive Post-Crash Prosperity, says that federal programs to promote homeownership don't make as much economic sense as they used to. When families bought suburban homes after World War II, the benefits rippled throughout the economy: U.S. manufacturers cranked out refrigerators and ovens for the kitchen, televisions and sofas for the living room, dressers and vanities for the bedroom, cars to carry Dad from the suburbs to his office downtown. "It worked fabulously," says Florida, a professor at the University of Toronto's Rotman School of Management. "It really primed the pump of America's industrial machine." These days, not so much: Appliances and furniture usually aren't Made-In-America anymore. Neither, increasingly, are cars. A housing boom doesn't deliver the bang for the buck that it used to, Florida argues. Feds rethink policies that encourage home ownership usatoday.com High homeownership rates also impose economic costs. They lock workers into houses that can be tough to sell, especially in recessions, so it's harder for them to move to find new jobs. The percentage of Americans changing addresses hit a record low 11.9% in 2008 before bouncing up a bit last year; the so-called moving rate exceeded 20% as recently as 1985. Florida has found that U.S. cities with high homeownership rates tend to lag behind other cities in job creation and earnings. He argues that the government should nudge the homeownership rate lower, perhaps to around 55%, by cutting the subsidies that prop it up. Would anyone in Washington risk political hara-kiri by killing housing subsidies to the middle class? "What really causes the decline of nations is when they become sclerotic, when they get locked into public policy approaches that don't work," Florida says. "I'm an optimist. ... We have reinvented ourselves before." But for now, he says, "Everybody is talking around the problem. We need to wake up."