Washington (CNN) – Housing prices have hit rock bottom and the economic climate is prime to purchase a home, said Housing and Urban Development Secretary Shaun Donovan.
In an interview broadcast Sunday on CNN’s “State of the Union,” Donovan said declining foreclosure rates make him hopeful, adding that it is “very unlikely we see a significant further decline.”
With 1.3 million homes in foreclosure, Donovan said he recognizes the frustrations of the American people but added that housing prices have largely stabilized following the “most serious crisis we’ve had in housing since the Depression.”
“Foreclosures are coming down. They’re down about 40 percent since last year,” said Donovan, who joined President Barack Obama’s Cabinet in 2009. “So, we are making progress, but rightly, the American people recognize we’re not where we need to be. We still have a ways to go.”
When asked about a push toward requiring home buyers to make a 20 percent down payment, Donovan said there should be a path for qualified individuals to purchase a home for less than 20 percent down.
“We can’t go so far in the other direction that we cut off home ownership for people who really can be successful homeowners,” Donovan said. “We can get back to the place where it’s a good investment and we will be able to make money over time.”
But he said Americans can also not revert back to using their houses “like ATM’s” with no down payments.
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“Foreclosures are coming down. They’re down about 40 percent since last year,” said Donovan
Because people are paying their mortgages? Or because banks have not instituted foreclosure proceedings while they work out technicalities in the process? If this administration believes they can spin numbers to convince Americans that the housing market is recovering, or has even bottomed out, they should legalize whatever it is they are smoking!
i wish the obama administration would loosen up immigration and let in another ten or twenty million people. immigrants are the engine of growth...look at texas or new york city...and they would snap up some of these cheap houses. we would see the housing market turn around overnight. it is foolhardy to have these rigid restrictions against immigration, especially against skilled and educated people, during a recession. this land is big and there is lots of room for more.
With a 9.1% unemployment rate I rather doubt housing will recover anytime soon. Renting is the way to go in an uncertain jobs climate. Flexibility to move where the new job is, trumps locking yourself in a house where the value could potentially keep dropping or even worse, have no appreciation for many years while the expenses to maintain keep coming.
It's sad that this government man believes he should be a salesman.
"...it’s so affordable today compared to where it’s been for generations.” This just simply isn't true for large swaths of the country. Barry Ritholtz has a very nice chart showing housing is still 30%+ higher than it was in 1998. Buying now would most likely mean you will be trapped in a house worth less than what you owe.
Still I am thinking
Now is buyers market plus low interest rate good opportunity to make some investment so we decided buy a house as investment (for rent ) but we are facing some problem. If my state follow like Arizona immigration law (they are trying at the same time they are punching numbers in calculator ) lot of rental property will become empty then it will hard to pay mortgage for second house. I don’t want hit bottom again
Then we look for small Restaurant for our retirement investment. We have to pull back because people don’t have money
Like me many are there with good credit score and money to make some investment but economy say no. we went through in 2007 and 2008 not again
Did anybody notice, there's 12 million unemployed?????
I didn't think so.
I agree, now that QE2 has finished mortgage rates have already started to climb and when they hit 5%, it is only going to get harder to qualify for a loan.
Plus, better jump in now and lock in at the 4's and get one before the GOP causes the U.S. to default on debt, because then the rate will be 15% minimum!, plus the stock market will be down around 4500.
Isn't that what put us in the mess the first time. Some idiot telling us now is the time to buy, just like in the late 90's. Refresh my memory who was running the country back then? Yeah, I remember his idea of everyone owning a house. I refused to buy one just to spite his idea. Who ended up being right.