Last Updated Jan 5, 2010 6:46 AM EST
And as any parent can tell you, the teenage years are nothing but fun.
Since there seems to be so much emphasis (by the federal government) on the power of positive thinking (green shoots will save us all!), I've decided to put forth my 3 real estate wishes for the new year:
Real Estate Wish #1: The residential real estate market is stronger than it appears.By any measure, the U.S. residential real estate market is on a serious amount of life support. And, as any doctor knows, a patient on life support can look pretty good.
Right now, the government is at the tail end of a buying spree, purchasing $1.25 trillion in U.S. housing-backed securities, keeping mortgage interest rates around 5 percent.
Fannie Mae and Freddie Mac, which along with FHA are doing almost 90 percent of loans, got a big New Year's gift from Uncle Sam, which offered to back any amount of losses these companies have, even if it goes above $400 billion. (Someone please tell me why Fannie and Freddie's stock is still trading-the subject of a future post, for sure.)
The $8,000 first-time home buyer tax credit, and the $6,500 trade-up (hopefully) home buyer tax credit, run through June 30, 2010 and the appliance version of Cash for Clunkers is about to start.
The good news is that existing home sales (and to a lesser extent new construction sales) numbers have improved, so a lot of real estate agents (judging by the chatter on ActiveRain and other real estate forums) are happier.
What will happen when all of the government's real estate life support is removed? My New Year's wish is that the real estate market doesn't grind to a complete halt.
Real Estate Wish #2: The Big Box Lenders will stop stalling and start foreclosing.Let's face it. There are a lot of people who can no longer afford their homes.
Millions of jobs have been lost and homeowners have lost $11 trillion in wealth. One in eight Americans (one in four children) are surviving only on food stamps with no other income.
A year ago, the Big Box Lenders stopped processing foreclosures. Then they started up again, then stopped, then started. When the Obama Administration introduced Making Home Affordable, foreclosures were put on the back burner while lenders tried to build models that made loan modification make sense.
The truth is, modifying loans isn't a top priority for lenders. Millions of Americans have been strung along, hoping that they'll get their bailout.
But they won't. Because they're not Big Box Lenders, or Fannie Mae or Freddie Mac or anyone else deemed "essential" to Wall Street.
So, my New Year's Wish #2 is that the Big Box Lenders stop stalling and start foreclosing so that millions of homeowners can begin to rebuild their credit histories and their financial lives and we can begin to work through the estimated 7 million or so foreclosures that have to be sold before the real estate marketplace can find its true bottom.
Real Estate Wish #3: Someone in the Obama Administration will sum up the courage to be honest with the American taxpayer.Making Home Affordable was a nice idea. But since it didn't actually require lenders to comply (the program was optional), or have any penalties for noncompliance, it never really got off the ground.
That's the best thing you can say about a program that has 700,0000+ homeowners enrolled in trial loan modifications and only 31,000 converted to permanent loan modifications.
(You only have to read the 200+ comments on my Loan Modification Hell post to see the insanity, chaos and true suffering this program has heaped on homeowners.)
The claim that the average homeowner in a trial loan modification is saving hundreds of dollars per month is false because the vast majority of these temporary loan modifications will not be made permanent. These people will likely lose their homes so instead of saving money, they are losing money and destroying their credit at the same time.
Instead of hiding behind bureaucracy, it would be nice if someone from the Obama Administration (perhaps Shaun Donovan, Secretary of the Department of Housing and Urban Development) stepped up and admitted that the four million people President Obama said would be helped by Making Home Affordable won't be.
I think a little dose of honesty would help us all reset our expectations and move on with our lives.
Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and the upcoming Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com.