Reply #19: Good points... [View All]

[sendero]

... and might I add that the trend towards low to zero down payment is not helping.

When you relax the standards for loans to the point where anyone can get one - lots of folks who are not prepared for the expense and responsibility of home ownership buy in.

The first hiccup in their income or expenses leads them to foreclosure, which is a drag on prices, which can lead to a vicious circle.

As far as I can tell, the blatant over-relaxation of lending standards is the FNMA equivalent of the Treasury's mighty printing press going into overdrive. At all levels, the Federal govt is taking drastic measures to spur consumption and keep this half-dead economy alive.