The Stimulus Package and Southern California Real Estate
The debate about the stimulus package has been all about jobs, jobs, jobs, though the main reason for the economic crisis has been housing, housing, housing. Really, improving the job market is a way to improve the housing market – to allow people to afford their current mortgage and not lead to yet another foreclosure. Of course it’s also good for 4 million people to pump new money into the struggling economy.
But the reason for the banking failure was their involvement in the subprime mortgage debacle, so to stimulate the economy, the housing market will need to be addressed as well. This is especially important for the Southern California market, as it was hit worst in the crisis. Other markets in the U.S. are measured against Southern California’s failures. So what is in the stimulus package to help the real estate market – specifically the SoCal real estate market?
Some features of the stimulus package include:
- Raising the agency jumbo loan limit by $100,000, up from $625,000.
- A 4% rate for 30-year mortgages
- Doubling the tax from $7500 to $15000
The trouble is that this is not seen to have an overwhelming impact. The real estate impact, like other industries is in a wait and see attitude. The issue at stake is not creating a new bubble, but basic stabilization. If the housing market doesn’t dip any further, it’s good news. As there was evidence of this occurring in Southern California, unlike the rest of the country which still has a ways to go, this cannot necessarily be attributed to the stimulus.
About Susan Andrews:
Susan Andrews is a top producing real estate agent at prestigious Beverly Hills real estate firm, Hilton & Hyland. She specializes in Hollywood Hills, West Hollywood and Los Feliz real estate. Susan can be contacted at 323.829.8811 or by e-mail regarding her properties.
