The Real Estate and Mortgage Industries Can (and Will) Survive!

This is good news! Now how do we get there? All economists are a bit confused on what needs to happen. First, let's get to the acceptance piece of the puzzle. (1) We are not in an economic recovery. Change needs to happen in many areas of the system the average consumer is living in. Jobs need to be created and the only way to do this is to create new industry. Real Estate Taxes are not only too high but they are not in proportion to reality. Not even close. Think on this. Why are homes on one street, same square footage, same design and similar age taxed thousands of dollars apart from their counterparts? This needs to be addressed. Tax assessors are working within guidelines of a "boom" that went way out into la-la land. Yet, they are assessing at those sales figures. It is a chain reaction in a system that needs to be redesigned.

There is a much needed reality check. Regulators, consumers and banks need to wake up quickly, which brings us to (2) to begin assess honestly, how we can renew our systems to have them fit into the change that is occurring in our democratic way of life. I am a republican and proud of it, but reality is reality. By 2020, the world will have an estimated 9 billion people to cloth and feed. This is not a one sided problem. It is a chain of past economic predictions that were just plain wrong. We are living in a system that has been broken. The chain of real estate ownership was created years ago when people began to buy and sell, price and live it their own home. Leasing was not looked upon as the American Dream. Owning a home was. Now, renting is so much more attractive to our pocketbooks. Why? OK- Think on this. You see a $250,000 home in the paper. Should you pay out of pocket 20% down (if your credit is perfect and very few have perfect credit) so that is $50,000. Who has this in an account right now without parents? Then up to another $10,000 for closing costs. The principal and interest is about $1200 a month( about 6% rate ) then you have taxes which can be about $350 more a month plus insurance can be about $150 more. You are at around $1700 a month and if there are those homeowner association fees, oh no- please? Now, the facts of these troubled times, this home is not holding value. Not good news for the American Dream concept. Next year it will probably be worth less, yet are taxes going up? So (3) is finding a way to build value in real estate again. Now, just suppose you can pay $1100 a month to live in that same $250, 000 home? When something breaks, you don't have to pay for the fix. No taxes fees or owner concerns. Just renters insurance to protect your own "stuff."

This brings us to (4) curing the disconnect of communication breakdown with banks, consumers and those running the real estate and mortgage worlds. Examples are government tax offices, Realtors®, mortgage professionals, jobs depending on industries that thrive on real estate such as contracting and engineering companies, etc. Pricing and regulation needs to be cut drastically. How can one home in a neighborhood, going through a short sale dictate prices of the other homes? It is all so off balance. Have you been food shopping lately? Our food supply is beginning to offer us less and short us as packaging is less for us to pay more. Boxes are smaller. Loaves of bread are smaller. So what can change all of this?

(5) is plain and simple we need laws designed for the people, by the people. When the Declaration of Independence was signed, it called for government for us. So let's remember real estate and mortgage markets drive the economy and let's remember that these markets can help bring about change quicker than any other markets. Once these markets create ways to achieve drastically lower utility bills, and real estate taxes are forced onto a more uniform format, all can recover.

Our system as we know it, is broken- Done. We will not ever find jobs for all who have lost theirs unless we re-train, re-create and re-build in the new world energy sectors offer. Going green. Tired of hearing this yet? Don't be and wake up America. Retrain those in construction and sales ability to learn to sell and install water conservation products as cisterns, solar products, solar hot water heaters and wind products. Train sales people to sell and represent these systems in the workforce. Re-create the entrepreneurial spirit. It worked years ago and it will work again-