Robert Shiller wrote in a recent article for the NY Times, “WE have to consider the possibility that the housing price downturn will eventually be as big as that of the last truly big decline, from 1925 to 1933, when prices fell by a total of 30 percent. This crisis should be an occasion for some inspired thinking about fundamental changes in our real estate institutions. The actions that have already been taken are not impressive. The housing market is worsening, and more and more home owners are getting into trouble with their mortgages.”
He recalls the innovations made in the real estate industry during the Depression Era between 1925 and 1933 and calls for similar actions between private industry and government. He points out that we are dealing with the problems today with outdated policies that were created during the Depression 70 plus years ago and policies for Federal Home Loan Bank System, Freddie Mac/Fannie Mae, the appraisal system, and bankruptcy laws require radical change.
read full article in the NY Times: A Time for Bold Thinking on Housing
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