This is a difficult time for anyone thinking about buying a home or renting apartments in Tay Ho Hanoi, especially if you are currently renting an apartment. The housing price spiral that drove up the price of homes has reversed, and prospective home buyers across the nation are perplexed by the thought of losing thousands of dollars in an uncertain market.
Much to the dismay of many potentially good home buyers, credit requirements have tightened, new home construction has declined, and the risk of losing equity in a falling market is significant in some area. In short many home buyers are feeling themselves being squeezed out of the market. Apartment renters dreaming of owning their own homes may not be able to buy their dream home without sterling credit rating. On the positive side, sales of existing homes have started to improve, but this may not be enough to reinvigorate the housing market. Given the overall housing market situation one cannot help but wonder if renting an apartment really such a bad thing?
Home ownership is touted as the great American dream, a way to create wealth that can be passed on to future generations. Home ownership is considered so important by the government that it has created a multitude of ways for prospective home owners to obtain a mortgage. Normally, placing people in their own homes would be a sound and a good policy to follow, as everyone benefits. However the drive to make money from the least empowered, specifically the middle class, has resulted in the deadly Adjustable Rate Mortgage (ARM) and other creative mortgage financing instruments that have only lead to foreclosure and the collapse of the national economy as soon as the economic engine began to sputter in 2007. An inattentive or look-away government and greedy financiers allowed the sputter to turn into a choking sound in 2008. Mortgages fell into default by the millions and the panic began. Today, the government is attempting to remedy the situation by pumping trillions of taxpayer dollars into the nation’s lending institutions in an attempt to bolster the credit market and as we all know credit, not money, is the economic jet fuel that powers the economy.
What does all this mean to the family trying to decide whether or not they should buy a home anytime soon? For starters it means that buying a home is going to be quite a bit more difficult than before.