Give The Housing Market An Enema—it's Full Of Crap!

By Author: Butch Grimes
Total Articles: 8
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Stimulus plans, band-aid solutions for struggling homeowners and short sighted solutions are not going to get our country out of this current housing crisis. We need to give the system an enema. Gross? Maybe, but I can't think of a better analogy for what's happening, and what needs to happen.

Housing Market is in Internal Distress

Diarrhea is normally caused by the bad bacteria overwhelming the good bacteria in your intestinal tract, or by an intestinal inflammation. Doesn't this describe the real estate industry?

Poor lending practices have created blockages and inflammation.

The only way to get rid of these damaging elements is to flush it out. With an enema. By taking an enema or enema series you rinse most, if not all, of the bad bacteria out of your intestinal tract. Taking an acidophilus enema to replace the good bacteria in your intestines, according to most physicians, is a good common sense idea.

Of course- it's not all smooth sailing. Enemas aren't fun. When your insides feel horrible already, do you really want more discomfort? Well, what if you knew that a bit of discomfort now ...
... would make you feel a lot better?

Sometimes, a gross or uncomfortable solution is the only way to restore health and balance to a damaged system.

The problem with most of the stimulus based solutions, and those coming from the real estate industry itself, is that they only put a muzzle on the mouth of the problem. It's a band-aid solution for internal bleeding. We need to get to the route of the problem and flush out the core causes of pain.

The Real Estate Industry is Full of Crap

Frankly, the real estate industry is so full of crap right now that a little diarrhea is the best thing for it. The housing industry needs an enema. It must let things flow out naturally. And there will be some discomfort before it's over. This means that:

- Not every one should own a home. Some folks are going to be faced with the harsh reality that they should not have been homeowners in the first place. They only got in because of enticing loan programs and relaxed underwriting. Bad loans are still lingering in the same places, moratoriums are prolonging the inevitable, loan modifications and rental ideas are keeping folks afloat that should not be afloat.

- Short term programs must go! Too many programs are buying folks time instead of solving the problem. Lowering of interest rates and dropping a payment $300 is usually not enough to help a struggling home owner afford that home in the long run.

- Banks need to pay, and forget interest rates. Why not lower the values on the loan (for those truly in a position to own)? Make the banks take the hit and lower the loan amounts to today's values. Forget the interest rate. A person will surely have a better chance of staying in that home that is realistically at $350,000 instead of $600,000. If the property gets back to that value then there can be a provision of equity share for the bank to make their money later. They surely made it up front on the lending points, fees, and servicing before the borrower went into foreclosure or stopped making payments.

This will make a major difference!! Immediately. This will truly correct the market. This will give everyone a fresh start to recovery. For those loans and borrowers that can't maintain, a good enema will flush them right through the system and the system will start to feel better.

As a long time realtor, minority advocate and committed educator, no one wants to see good people own their own homes more than I do. However, until we have reasonable standards for home loans, credit scoring, and homeownership back in place—no one will be in a good position. Not buyers, not sellers, not banks and lenders, not the real estate agents I hear from daily at http://www.WeTalkradio247.com.

An enema might not be the most comfortable solution. But it's the only way to flush out the ugly objects that have infected the housing system, and restore it to a healthy balance.

About the Author:

Butch Grimes Real Estate guru, community activist, renowned industry leader whose books, national tours and educational approach to real estate and technology have made him a sought after figure in the California and national real estate markets. Butch Grimes Popular radio show and podcast at www.WeTalkRealEstate.com. Innovative real estate and social networking site at www.WeTalkradio247.com.