Writing in nationalmortgagenews.com, Lynn Effinger states evidence is mounting we are sliding back into another housing downturn. He says the shadow inventory of foreclosures which have not been released into the marketplace is artificially inflating home values. He notes the rise in institutional investors buying up bank-owned properties and making them rentals is backfiring because they did not consider home prices falling and vacancy rates rising. With over 30 years experience in the housing market, Effinger informs MHProNews fewer first-time buyers are entering the market, despite the low interest rates, because there has been little effort to create decent-paying jobs that would support sustained growth in homeownership. In addition, some lenders are lowering their FICO scores to accommodate borrowers, and the federal government is once again encouraging lenders to make loans to low-income buyers—a tactic that, in part, led to the housing downturn and subsequently the Great Recession. He also decries the gridlock in Washington that has prevented leadership/legislation from effectively dealing with the housing marketplace, perhaps because our elected officials are likely more concerned with getting re-elected than solving problems. ##
