Home > Uncategorized > On Residential Real Estate and the Political Imperative

On Residential Real Estate and the Political Imperative


Part of the problem with residential real estate is that it makes for bad politics. When the economy is booming and capital is cheap, politicians are falling all over themselves to inveigh against bankers and mortgage writers for making it harder for Americans to achieve the American dream of home ownership. When the economy is in the toilet and capital is still cheap but no one is lending and loan modification is elusive, those same politicians inveigh against the banks and mortgage writers for forcing American families to stay in homes that they can’t afford.

The net result is that bankers can’t win. No matter that bankers wrote mortgages for people who had no business buying housing; that is inexcusable behavior on the part of bankers, and their banks’ balance sheets should, but for the magic of securitization, have suffered for such stupidity.

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