Real Estate Outlook under Obama Administration

As Barack Obama became the 44th president this afternoon, we can expect major changes in the real estate market. The Obama administration wants to end the foreclosure epidemics through ambitious new programs designed to rework the terms of hundreds of thousands of mortgages that are now unaffordable. Versions of that program might include:

• principal write-downs, outright reductions in home owners' mortgage balances, and guarantees to lenders in the event borrowers re-default.
• immediate ban on foreclosure actions for three months, and is certain to enact bankruptcy reform legislation allowing judges to modify mortgage terms to forestall foreclosures.

If the new administration can successfully reduce the numbers of new foreclosures, there's an excellent chance that the current combination of low prices and record low mortgage rates can have the effect to increase new sales.