NEWS    RECALLS    COMPLAINT FORM    SCAM ALERTS   RESOURCES  
Small Claims Guide   Class Actions   Lemon Laws   FAQ   Newsletters  


Complain about a product or service

Automotive    Education    Employment    Electronics    Family    Finance    Health    Homeowners    Pets    Shopping    Travel   



NEWS   Latest |  Archives |  Auto |  Cells, etc. |  Computers |  Financial |  Health |  Homeowners |  Parents |  Privacy |  Scams |  Seniors |  Travel

Obama Can't Quickly Raise Homebuyers' Hopes

Prospective buyers unsure if this is their moment





By Broderick Perkins

November 9, 2008

Obama
Banks Prepare for Assault on Obama's Proposed Financial Protection Agency
Consumer Groups Back Obama Regulation Changes
Obama Proposes Massive Regulatory Overhaul
Obama Seeks 19 Percent Budget Hike For FDA
White House, Congress Cracking Down On Credit Cards
White House Pressuring Credit Card Companies
Obama Tackles Food Safety Issues
Consumers Hopeful of Better Times Under Obama
Obama Can't Quickly Stimulate Homebuyers' Hopes
Upper-Income Taxpayers Seeking Shelter
Obama Eyes Consumer Activists for Agency Posts
Consumer Issues Could Get Early Focus in Obama Administration
"Fixing" Health Care: What Does That Mean?
Obama Calls for Bankruptcy Law Reform
Is Obama Dragging Down the Stock Market?
Obama Pledges Doubled Funding for Product Safety Agency

Homebuyers are not so sure that this is their moment.

They haven't given up on the dream, but as the curtain rises on a historic presidency, homebuyers are not celebrating their place in line behind homeowners waiting for relief.

President-elect Barack Obama has long been a staunch advocate of federal assistance to help homeowners avoid foreclosure.

But that doesn't convince most homebuyers that the nation's new leader can immediately improve opportunities to buy a home.

The overwhelming majority of new federal, private and business relief efforts have been focused on the homeowner, not buyers.

Home buyers understand problems that weren't created overnight won't be resolved that quickly, even by a new, charged-up president elected on the promise of change.

And Obama gets it.

"I do not underestimate the enormity of the task that lies ahead. I have said before and I will repeat again, it is not going to be quick and it is not going to be easy for us to dig ourselves out of the hole we are in," Obama said recently, during his first press conference as president-elect.

The focus of his comments was an economy in shambles, but the housing sector has been a wreck too since lenders pulled the rug out from under homebuyers.

Homebuyers nervous

Earlier this year, the majority of homebuyers, 56 percent, believed the housing market would not improve once the U.S. had a new president. That's according to a Harris Interactive survey commissioned by Move, Inc., the operator of the Realtor.com Web site.

Most homebuyers, 81 percent of them, said they were nervous about their prospects in the current housing market. Their anxieties were based on barriers they said existed between them and home ownership. Barriers included, the cost of a down payment, insufficient income and home prices.

Toss in how difficult it is to qualify for financing these days and it's easy to see why most homebuyers are so bummed. Economic conditions have crushed consumer confidence.

The Consumer Confidence Index, which represents consumer sentiment about the economy, crashed from 61.4 in September 2008 to 38 in October, a record low for the 41-year old survey, according to the Conference Board, a private research group.

Why are consumers so glum about the economy? For one thing, housing costs have gotten brutal.

Brutal costs, anemic income

Mortgage Crisis? Act Now to Avoid Foreclosure
Avoiding Foreclosure Takes More Than Hope
---
Home Prices Fall, But News Is Less Bad For Homeowners
Marketing Analysis Suggests Housing Bottom
Mortgage Rates Dip As Inflation Fears Ease
Have Mortgage Rates Hit Bottom?
Ex-Countrywide CEO Faces Fraud Charges
Pending Home Sales Surge in April
Foreclosure Starts Hit 1 Million For the Year
Mortgage Delinquencies At Record High
Existing Home Sales Rise in April
U.S. Home Values Now 32 Percent Below Their Peak
Bankruptcy Not Helping People Keep Their Homes
Home Values Plunge 14 Percent In First Quarter
One In Five Homeowners Underwater
Pending Home Sales Turn Around In March
Senate Defeats Mortgage 'Cram Down' Bill
Mortgage Rates Keep Falling
Home Sales Fall in March
Home Prices Show Surprising Gain in February
Foreclosures Up 9% in First Quarter
Southern California Home Sales Up Again in March
Mortgage Applications Rise Sharply
Obama Administration Targets Mortgage Fraud
Homeowners Still Behind On Modified Mortgages
Consumers Fall Further Behind on Loan Payments
Pending Home Sales Show Some Life
Home Prices Down To 2003 Levels in January
Fed Action Spurs Refinance Frenzy
Existing Home Sales Jump Five Percent in One Month
California Authorities Arrest "Loan Modification" Scam Artists
Southern California Home Sales Up Again
Loan Modifications Can Reduce Foreclosures, Study Says
Scammers Use Forged Bank Letterhead to Con California Consumers
Foreclosure Activity Up Six Percent in February
States Battle Feds To Enforce Lending Laws
Mortgage Delinquencies Continue to Climb
Obama Begins Mortgage Rescue Program
One Of Five U.S. Mortgages Under Water
Florida Court Blocks Loan Modification Company's Fees
---
More ...

The Center for Housing Policy, says in ten years ending in 2006, on average, all major categories of homeowner expenses increased faster than incomes.

Rents were up 51 percent, mortgages 46 percent, utilities 43 percent, property taxes 66 percent, and homeowner insurance 83 percent, according to the center's new "Stretched Thin: The Impact of Rising Housing Expenses on America's Owners and Renters."

Meanwhile, homeowner incomes increased by only a comparatively paltry 36 percent. Renters' wages rose about 31 percent.

The squeeze didn't let up in 2006. Large increases in heating, transportation and food costs have further tightened the cost-of-living vice and put a stranglehold on family budgets.

Obama insisted during that first press conference that it's critical to "help hard-working families" but many homebuyers found little comfort in comments that don't answer the question, "When?"

Unfortunately, the new president isn't making any time-tagged promises because he can't. A housing market quantum leap -- or two -- is necessary before homebuyers enjoy happy days again.

• Urban Land Institute's "Emerging Trends In Real Estate 2009" says don't expect housing prices to bottom until late 2009, but concedes even that could be a tall order.

The report surmises a 2009 bottom will arrive only if distressed properties have moved through the system, only if lenders loosen the purse strings, only if interest rates cooperate and only if there are more job and wage gains for the year.

"We need to move back to pricing levels from 2003-2004 before a floor establishes," according to the report.

• Real estate trends guru Stefan Swanepoel, previewing his yet-to-be published "Swanepoel Real Estate TRENDS Report 2009" says "2009 will be pivotal," but not necessarily the bottom.

The report says housing will be more affordable, at the expense of buyers who purchased during peak market "and must endure at least another year of home price declines."

Move-up buyers, says Swanepoel, will stick to the sidelines and wait for the bottom of the housing market "which may not materialize until after 2009."

Deadline Newsroom's unscientific "When Will Housing Recover?" survey of blog visitors, found that among 237 of those who voted since early this year, 20 (8 percent) said housing would recover in 2008; 62 (26 percent) said 2009; 84 (35 percent) said 2010; and 71 (29 percent) said housing won't recover until later than 2010.

None of this means consumers have given up on homeownership, nor should they.

More than half of renters who plan to buy a home someday will do so in the next five years. Among current home owners, 41 percent plan to buy again, the study said.

And consumers will sacrifice to put their own roof over their head.

Nearly 80 percent of consumers Harris surveyed would be willing to save more, earn extra income, compromise on neighborhood features and skip some home amenities in order to buy a home right now.

That's all pretty much what buyers were doing before the boom.

---
Broderick Perkins parlayed 30 years of old-school journalism into a digital real estate news service, the DeadlineNews Group, offering "News that really hits home!"™. The Silicon Valley bootstrap includes the Web site DeadlineNews.Com and the back shop Deadline Newsroom. Contact him at news@deadlinenews.com.



Report Your Experience
If you've had a bad experience -- or a good one -- with a consumer product or service, we'd like to hear about it. All complaints are reviewed by class action attorneys and are considered for publication on our site. Knowledge is power! Help spread the word. File your consumer report now.



Asterpix

CONSUMER NEWS

SAFETY RECALLS

FREE CONSUMER NEWSLETTERS

The Daily Consumer
Afternoons M-F

Sign up now!


Consumer News & Alerts
Every Sunday

Sign up now!

MOST-VIEWED PAGES

NEW COMPLAINTS

Hey there! ConsumerAffairs.com is using Twitter.
Twitter is a free service that lets you keep in touch throughout the day. Join today to start receiving ConsumerAffairs.com's updates.

Back to the top |

Advertisement


Custom Search
AUTOMOTIVE
• Dealers
• Manufacturers
• Service
• Extended Warranties
• Lemon Laws
• Recalls
• Tires
• Transporters

FAMILY
• Aging
• Children, Parenting
• Recalls
• Dating
• Education
• Entertainment
• Pets
• Weddings
FINANCE
• Annuities
• Banks
• Credit Cards
• Debt Collection
• Debt Counseling
• Insurance
• Investing
• Loans
• Mortgages
• Payday Loans
• Student Loans
• Tax Prep

HEALTH
• Doctors
• Drugs, Pharmacies
• Health Clubs
• Hearing Care
• Hospitals
• Nursing Homes
• Nutrition, Diets
• Vision Care
• Weight Loss
HOMEOWNERS & RENTERS
• Appliances
• Cookware
• Furniture
• Home Improvements
• Lawn & Garden
• Movers
• Pools & Spas
• Realtors, Rental Agents
• Recalls
• Utilities

ELECTRONICS
• Cable TV/DBS
• Cameras
• Cell Phones
• Computers
• Home Electronics
• Internet Access
• Local Phone Service
• Long Distance
• VoIP
SHOPPING
• In-Home
• Online
• Retail Stores
• Sporting Goods
• Supermarkets
• Telemarketers

TRAVEL
• Airlines
• Bus Lines
• Car Rental
• Cruises
• Hotels
• Travel Agents
• Trains

RESOURCES
• Class Actions
• Complaint Form
• Small Claims Guide
• Lemon Laws
CONSUMER NEWS
• Latest News
• Automotive
• Telecom
• Financial
• Health
• Homeowners
• Scams
• Seniors
• Travel
• More ...

RECALLS
• Automotive
• Children's Products
• Drugs
• Food
• Household Products
• Sporting Goods

ABOUT US
• FAQ
• Privacy Policy
• Advertise With Us
• Newsroom
• Syndication
• Terms of Use

Terms of Use Your use of this site constitutes acceptance of the Terms of Use

Advertisements on this site are placed and controlled by outside advertising networks. ConsumerAffairs.com does not evaluate or endorse the products and services advertised. See the FAQ for more information.

Company Response Welcome If complaints about your company appear on our site, we welcome your response. Please see the Response Form for more information.

For more information, see the FAQ and privacy policy. The information on this Web site is general in nature and is not intended as a substitute for competent legal advice.  ConsumerAffairs.com Inc. makes no representation as to the accuracy of the information herein provided and assumes no liability for any damages or loss arising from the use thereof. 

Copyright © 2003-2009 ConsumerAffairs.com Inc.  All Rights Reserved.    The contents of this site may not be republished, reprinted, rewritten or recirculated without written permission.