The Real Estate Bloggers

Let The Market Determine Home Prices, Not Government

Posted: 04 Aug 2010 03:48 AM PDT

Suburbia For the past couple of years I have turned into a broken record on the governments intervention in the housing market. The incessant need to fix the market by the government has extended the agony for home owners and the housing industry.

Ravi Nagarajan, writing in at Seeking Alpha, has a powerful article expressing these same themes and adding in another component that I have typically overlooked.

The stalling of the housing market has hurt the ability for American’s to move to where there is employment. This Nagarajan says is one of the great strengths of the American people. Labor flexibility.

Yet with a moribund housing market and millions of homeowners underwater, people are getting stuck in bad employment regions due to housing constraints and are unable to move where the jobs are.

We need to start trusting the American people again instead of relying on the federal government to fix our problems.

Then we can return to a healthy real estate market and a healthy economy.

Too many Americans purchased housing using aggressive low down payment mortgages with teaser rates that even two income households struggled to afford during the boom years. The predictable disasters have now been well documented, but apparently the government still clings to the illusion that home ownership is worth pursuing for the marginal borrower. Freddie Mac is continuing to advertise down payment assistance for “responsible borrowers” who nevertheless lack funds for conventional down payments and closing costs. Through a bewilderingly array of grants, second mortgages, tax credits, and other programs, Freddie Mac is encouraging marginal borrowers to purchase homes that they cannot clearly afford.

At a time when home prices could very well decline further, it seems irresponsible for a government controlled agency to promote home ownership for anyone who cannot come up with a traditional down payment. However, now that the $8,000 tax credit for first time homebuyers has expired, it appears that government is doing what it can to continue propping up activity in the sector rather than allowing market prices to fall to a natural equilibrium level. This will only prolong the pain in housing in general and expose more Americans who probably should be renting to the loss of employment mobility and potential for losses that low down payment mortgages create. via Seeking Alpha

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Let The Market Determine Home Prices, Not Government

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JD Powers Survey Says Keller Williams Best For Buyers, Prudential For Sellers

Posted: 03 Aug 2010 07:23 AM PDT

JD_Powers_trophy The JD Powers Survey is the gold standard these days for customer service. They delve deeply into the heart of the consumer to see who gives the best perceived service.

This year the results were very positive for the home buyers and not as positive for the home sellers. Makes sense as this is a tough market for someone to sell their home at a price that they hope to get with all of the foreclosures and short sales flooding the market.

Keller Williams led the way with their quality of service for home buyers. For home sellers, Prudential was the leader in the market place. In all reality though, the 2 firms were in 1^st and 2^nd in their respective categories so the results were a dead heat.

Congratulations to Prudential and Keller Williams and we expect to see lots of the their ads featuring the gold seal of the JD Powers endorsement.

In the home-buyer segment, Keller Williams ranks highest for a third consecutive year, with a score of 817 on a 1,000-point scale. Keller Williams performs particularly well in the agent and office factors. Following in the rankings are Prudential (811) and Coldwell Banker (805). Prudential performs well in the additional services category.

Among home sellers, Prudential ranks highest with a score of 760 and performs particularly well in the marketing and agent factors. Prudential is the only company to improve in home-seller satisfaction in 2010, compared with 2009. Following Prudential in the rankings are Keller Williams (751) and RE/MAX (744). Keller Williams performs particularly well in the office factor.

Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.

JD Powers Survey Says Keller Williams Best For Buyers, Prudential For Sellers