A Case For Real Estate / The Great Depression

This is not the first real estate bubble we have had “burst” and it will not be the last. It is my opinion that the government got us all into this mess and it is their obligation to get us out….NOW.

The government is constantly meddling in the real estate business. “First time home buyer tax credit” of this year was just one in a long history of our political “leaders” trying to drum up business for the real estate industry.

In 1919 The National Association of Real Estate Boards (Now NAR or National Association of Realtors) was promoting real estate via the “Own Your Own Home” campaign. This was a industry based program run by Realtors. Herbert Hoover (the then secretary of commerce) encourage the United States government to take over this program to increase home ownership. And the cycle of real estate was forever altered. Since then, it seems like the government has had a hand in real estate, trying to make it more and more affordable so “every American” can live the dream and own a home. This of course so the banking industry could stretch loans out over 30 years and rake in insane revenue on those 30 year loans!

After our country went into the “Great Depression” in the 20’s, how did the country get out of that mess? 25% of Americans were out of work and most of those jobs were construction related! Reigniting the real estate market back then was a great way to create jobs and get the economy rolling again! Talk about a “Stimulus Package” on steroids!!!

So what does America do in 2008 and 2009? We repeat what history taught us and get the real estate industry back on track, getting value back up, getting those construction workers, surveyors, roofers, plumbers, electricians, lawn service companies, painters, Realtors, lenders and everyone related to our field! WOW, what a TRILLION DOLLAR BAILOUT could do for the economy………….. except Obama flushed that toilet when he blew the trillion on HIS ego driven Stimulus package that has clearly and unequivocally FAILED the American people.

The government dug the hole. Now the CAN’T get out of the real estate game…. can they? I say YES they can…… eventually. If they eliminate the capital gains tax on real estate across the board, no matter how short of a time a person has owned the property, we would clear out of this mess sooner rather than later. Further, property taxes like we have in Florida are BULL _ _ _ _!!! Every state that has property taxes could raise the sales tax .02 per dollar and the revenue created would more than offset the income generated by the loss of property taxes. Now (in Florida for example) the tourists can pay some of that money to rebuild our roads, etc. (since they help destroy and use those roads now) This will reduce the overall cost of home ownership (total payment) by 1/3 in many cases. Buyers who can’t afford to buy, now will be able to and as they buy those starter homes, everyone can move back up the food chain!

After the market gets healthy again, we can only hope that the government can stay out of the business of trying to get every American to own a home. (How did that work out for you President Clinton?). The TRUTH IS, some people will NEVER own a home and will be lifetime renters. America, there is nothing wrong with that! Everyone does not need to buy or own a home for America to be great! We just need responsible leadership that understands economics and how the system works. 2012 seems really far off to me, but November 2010 is just a few weeks away! I can FEEL the market recovering now!

http://www.headofrealestate.com

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