Is The Housing Market Going To Rebound In This Current Economy

Is the housing market going to rebound in this current economy

Introduction

The United States housing market has been affected by the economic bubble which we call the United States housing bubble. Over half of American states have been affected by this bubble since the last quarter of 2006 and the housing prices have been decreasing since then. The reason behind the decreasing prices is the collapse of subprime mortgage industry in March 2007 which was due to more than expected home foreclosure rates also when 25 subprime lenders declared bankruptcy,announced huge losses and had put themselves for sale. The united states government has taken several measures to improve the housing market. In 2008, the government of United States allocated more than $900 billion to the housing bubble for special loans and rescues related problems, out of which more than half was given to the two government sponsored enterprises named Fannie Mae & Freddie Mac and to the government agency named Federal Housing Administration. Regardless of all these efforts the situation did not improve, neither any signs of improvement can be seen in this year.

The mainstream news and comments from the politicians in Washington D.C gives hints that the housing market of United states is collapsing every day and statistics that roll in further confirms the claim. Until April 2010, United States government was giving substantial tax credit to the home buyers to stabilize the real estate market, but after its expiry, the collapse of the United States housing market continued. The mortgage defaults and the foreclosures have started setting new records and so have been the home repossessions by banks. The number of homes that are being constructed and the number of people who are applying for home loans have also been at very low levels. Buying a house was a significant part of "the American dream" but now it's no more since it is out of reach for many people. The simple answer to this is that there are no enough jobs for people without which the housing recovery is not possible. This downturn in the housing market is not short because every year more people are losing jobs that are worsening the housing market further. The market sales of new and existing homes in the U.S have been quite low recently. In May 2010, the sales of new homes declined to the lowest level ever recorded since 1963 as reported by the U.S department of commerce. In July 2010, the sales of existing homes fell by 22 % in southern California and 25% in Austin, Texas as compared to 2009. Since there are too many homes already, the construction of new homes in the United States has come to a standstill. The construction of new homes and applications for building new homes also fell to the lowest level in July 2010 and people are also less willing to apply for home a loan which is one major source of financing, ...