What is the effect of eliminating foreclosures?
I can think of: elimination of proper price discovery and the fact that you are keeping people in homes they can’t and will never be able to afford.
the bad neighborhoods are a lost cause already and will be reinhabited at the right price and time. the good neighborhoods will include homes where people can’t afford to stay and thus the govt/banks are paying the difference. in the average neighborhoods, market price is indeterminable and many of should be moving to other neighborhoods and making way for those in the good neighborhoods who shouldn’t be in good neighborhoods.
http://online.wsj.com/article/SB123454524404184109.html?mod=testMod
they’ve had a freeze on from november - january and now have put another one on for about a month. why not just man up and say you’re going to keep one on indefinitely and stop realizing losses?
I can think of: elimination of proper price discovery and the fact that you are keeping people in homes they can’t and will never be able to afford.
the bad neighborhoods are a lost cause already and will be reinhabited at the right price and time. the good neighborhoods will include homes where people can’t afford to stay and thus the govt/banks are paying the difference. in the average neighborhoods, market price is indeterminable and many of should be moving to other neighborhoods and making way for those in the good neighborhoods who shouldn’t be in good neighborhoods.
http://online.wsj.com/article/SB123454524404184109.html?mod=testMod
they’ve had a freeze on from november - january and now have put another one on for about a month. why not just man up and say you’re going to keep one on indefinitely and stop realizing losses?