Housing Market WILL NOT cause a recession

In response to the previous post, the other side of the debate...

According to economic analysts at CNN, the housing market recession is not global, nor national for that matter. Decline in housing capital can only bee seen in certain parts of the United States; parts in the Southeast are hardly affected and have rapidly growing markets. Both analysts and prospective homebuyers believe that the housing recession has already reached its lowest point and, once sellers relax prices enough, buyers with good credit will return to the market, discoursing unscrupulous lending practices and variable-interest mortgages. Similarly, the Federal Reserve should not interfere with a recovering trend, which is part of natural cycles of growth and recession in the economy. There is not enough capital in the housing market for people to make loans at this stage, but most Americans say they are confident they could sell their home within the next six months for a fitting price.

Stricter regulation should also be placed on subprime mortgages to prevent rapid economic recessions in the future. Measures must be taken prevent borrowers from falsifying information about their financial condition to obtain a subprime mortgage (known as a "Liar Loan") and to curb dishonest subprime lending practices and "predatory" mortgages. However, policy regarding the market regulation must not involve the Federal Reserve, which is blamed for much of the recession after they created a reckless demand by making the cost of borrowing money artificially cheap. Although the housing market is currently in a slump, the overall economy is still healthy and shows little loss of momentum from the recession. Availability of jobs has risen to 28.6 percent from 28 percent and interest rates have not increased, indicating that the status quo is currently maintained.