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Obama vs. McCain on Real Estate

In an article today, Realtor Magazine outlined Senator Obama’s and Senator McCain’s stance on the real estate crisis. Further insight to each candidate’s plan can be found on Trulia in a post by Julie Jones where they have a good discussion already started. So how does this all affect the Hawaii real estate market? Let’s take a look at both sides and see if we can figure that out.

Here’s an overview of both stances:

Barack Obama

  • Create a $10 billion foreclosure prevention fund to help homeowners who face foreclosure.
  • Empower bankruptcy courts to modify a homeowner’s mortgage payments.
  • Create a simplified standardized metric for calculating loan costs and provisions and requiring full disclosure of such costs.
  • Stop Fraud Act creates criminal penalties for mortgage fraud.
  • Increase state and federal funds to enforce the Stop Fraud Act.
  • Mortgage credits for homeowner’s that don’t itemize deductions.

John McCain

  • Boost the economy by lowering tax rates and increasing business investment incentives.
  • Direct assistance to homeowners
  • No taxpayer money should go to real estate speculators, and lenders cannot use FHA to bail them out on all the bad loans they made.
  • Reform financial and lending systems to stop this from happening again.
  • Assist homeowners (in high growth states forced into risky mortgages) get into safe Federal Housing Administration loans.
  • Financing for local groups trying to solve these problems within their own communities.

These two very different stances both have interesting points. Obama wants to throw more money at the problem, but where will the money come from if he doesn’t plan on increasing taxes? McCain’s plan lower’s taxes and gives incentives, but will this really boost the economy in it’s current state?

What I’d really like to know is if McCain considers Hawaii a high growth state that forced homeowners into risky mortgages. I know that on my Island, the price of homes more than doubled in just a few short years. Would this be considered a high growth rate? I know of several families forced into bad loans that could really use the assistance.

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October 23, 2008

no one is “forced” into a bad loan. What mistakes should society subsidize? If someone made a bad decision to buy an overpriced house using a loan they cannot afford, and the fed/state take tax dollars to pay them back, what does that say to responsible buyers and renters? This “victimization” by “forced into bad loans” mentality does not fly with me. But, politicians pander, especially before the election. Afterwards may be a different story.


October 24, 2008

@David – I agree with you that the homeowner is ultimately responsible for the decision to buy their home and the mortgage that comes with it.

However, people are not necessarily educated in the home buying process, and sometimes they rely on others instead of doing the research themselves. And when you have a lender telling you, “Don’t worry about the mortgage payment, you can do an interest only loan for 5 years and then just refinance when you have some equity”, there is a problem. Because the buyer is obviously worried that the home is more then they can afford. They are just being given bad information and getting themselves into a loan situation that will obviously backfire on them.

I’m not saying this is the case in every situation, but I know of several situations like this where I live.


October 24, 2008

Justin, I get it. It’s just my opinion.

So, how ’bout that Kauai real estate market?


October 25, 2008

McCain is definitely the lesser of the 2 evils. Obama is a straight up socialist and liar. He has a lot a people fooled and thinking that he is going to make a lot of change for the better. If he does what he says he’s going to cut taxes 95% of Americans and raise taxes on the evil people and businesses making over $250,000. They are going to end up paying a lot more in higher prices that the evil businesses are going to have to pass on to consumers. LOL. Then the evil businesses are going to have to either outsource stuff to foreign countries that have cheaper labor. Meaning loss of jobs as well.

There will also be less freedom and opportunity for growth since the government will have more control. Americans are forgetting our history and why so many people envy the United States.

You will not be able to recognize this country when Obama and the liberal congress get done running into the ground. The strong will survive and the weak will be a lot worse off in 4 years. They should be careful for what they wish for.


October 25, 2008

How about that Hawaii real estate market. Hawaii foreclosures up 334%. Hey Katie, I thought it was a great time to buy? Looks like we haven’t hit bottom yet.


October 27, 2008

@David – In my (non real estate agent) opinion, the Kauai real estate market is really good for buyers right now. I’ve just purchased my first home and I’m looking to pick up a second property on the North Shore. So far, I’ve made several offers and have come within 10% in price (on multiple occasions) of securing a property where if I put 20% down, would have a positive cash flow as a long term rental.

@Kimo – Every location in Hawaii is isolated, but there are several neighborhoods in the islands where now is a great time to buy. I live in a small town, and it is common knowledge (by word of mouth) about which properties are in distress situations. If these properties don’t sell, they will go into foreclosure. So, you can wait until the bank has taken over and bid against others on foreclosure properties, or you can work with an agent now, and make offers to banks directly. You’d be surprised about what you can accomplish without any other bidders competing against you.

Tim Madson

February 26, 2009

Mike dallas, thats a pretty good track record. hope it stays that way.

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