I’m From the Government
Do I Have Your Permission to Speak Honestly?
I’ve never had anyone say no to this question, whether it be sitting down with a potential client or with a friend who might be asking for advice. So here goes.
Arguably the biggest election of our lives is a mere 2 1/2 months away. As the days tick by, it makes me think of one of my favorite characters, Mark Twain, who said:
“If voting made a difference, they wouldn’t let us do it.”
I’m starting to believe that more and more. Many folks across this great country are having a very hard time making ends meet financially. It’s easy to understand why some hope the results of the election might help them make a mortgage or car payment or put more food on the table.
I have spoken to home buyers and sellers who say to me that they’re waiting for the election before making a decision. Really, why? Is either candidate going to tackle our runaway debt? Is either going to heal the terrible divide in our country? And what about the real estate market? What exactly are we hoping for from the Government?
I want to tell you a story that many of you probably never heard. Former President Bill Clinton, appointed Andrew Cuomo (yea, the future NY Governor) to his Cabinet as Secretary of Housing and Urban Development. Cuomo held that position from 1997-2001. Andrew had the bright idea that banks were being too tough when it came to approving loans to buy a house or condo. He said that they were discriminating against women, minorities and every group he considered to be marginalized. HUD, acting on Cuomo’s orders told banks to loosen the reins on mortgage lending or else. Cuomo threatened them with sanctions if they didn’t lend to these segments, and fast! He reminded them that the loans were government insured.
Bankers got the message and were quick to respond. The Government wanted them to lend and lending generated fees…so they lent, and boy did they lend. No income? No job? No problem! And they didn’t stop at the margins of society either…all were welcome. In the words of Oprah, you get a house, you get a co-op, you get a condo!
The indiscriminate lending over the next years led to one of the biggest real estate bubbles the country has ever experienced. People that had no business owning a home were essentially given blank checks to go out and buy. With the help of Government induced low interest rates, this madness led to an upward spiral in real estate values, which enabled many to use their imaginary equity to buy multiple homes or condos. Finally in 2008 it all came crumbling down. Who paid the bill for that? We did. Taxpayers bailed out the Banks because when they say it’s Government insured, what they really mean is it’s us, you and me that are insuring it. Sure we don’t pay directly, but it gets slapped onto the debt (now at 35 TRILLION). This is a weight hanging over us, our kids, grandkids and generations to come.
Most of the problems we face as a nation, the really big problems have been created by Government. Whether it be overreach, corruption, or even good intentions with unexpected consequences. When it comes to real estate, thinking that a new administration will make prices go down for buyers or up for sellers is just silly. No one knows what is going to happen with home prices, or interest rates or anything really over the next 4 years. What history has taught us is, if the Government gets involved in it, things are likely to get worse for everyone.
So let’s worry less about the election and more about our family, our community and the things that bind us together, and less about the things that we foolishly allow to divide us.
Have a great upcoming weekend and week ahead,
Sal Busacca, Realtor
Keller Williams Greenville Central
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