Will Congress see the housing crisis?

[NVMojo]

Sept. 5

In the past five years, housing prices in Fairfax County, Va., have grown 12 times as fast as household incomes. The county’s median family would have to spend 54 percent of its income to afford the median home; in 2000, the figure was 26 percent. The situation is so dire that Fairfax has begun offering housing subsidies to families earning $90,000 a year.

The scarcity of affordable housing is a deepening national crisis, and not just for inner-city families on welfare. The problem has moved to the suburbs, where service workers cram their families into overcrowded apartments, college graduates crash with their parents, and firefighters, police officers and teachers can’t afford to live in the communities they serve.

Homeownership is near an all-time high, but the gap is growing between the Owns and the Own-Nots — as well as the Owns and the Owns-80-Miles-From-Work. One-third of Americans spend at least 30 percent of their income on housing — the federal definition of an “unaffordable” burden. Half the working poor spend at least 50 percent of their income on rent, a “critical” burden.

more...

http://www.cantonrep.com/index.php?ID=306045&Category=14

[physioex]

1. I agree.....

WTF is going on with housing prices. Why are people taking out ARM with out giving them a second thought? How much longer can this continue? Also here in the Seattle area economists are taking about the fact that this area may not be affected by any housing bubble and prices will continue to climb because it is cheaper when compared to California.

[larrysh]

2. ARMS are evil and something needs to be done about them.....

ARMS are nothing more than a way for people who cannot possibly afford the house they are buying, to buy a hosue they cannot possibly afford.
The absolute only people who benefit from ARMS are the real estate agents and the mortgage brokers (not the banks, they get stuck with
over-priced real estate they can't unload once repossessed), but the mortgage brokers, often times shady operators who depend on "credit fixers" and unscrupulous appraisers who will do anything and provide
any appaisel to "get a deal done". Nice young couples all excited about their home soon learn that not only can they no longer afford the
payments as interest rates rise afster than their incomes, they are also
stuck in a home they can't sell, as the appraisel was "juiced", as well.

[NVMojo]

3. excellent explanation of the unethical actions behind ARMs here

http://itulip.com/forums/showthread.php?t=381

[ixion]

4. Buying a house with an ARM loan is like buying it with a credit card

it's just plain crazy, IMO. :crazy:

[Nikia]

5. I still don't quite understand about the housing crisis

I am living in rural Wisconsin where you can buy an older home in move in move in condition for under $100,000. For not much more or if you are willing to do a little bit of fixing up, you can move into a 2,500-3,000 square foot home. For $350,000, you can live in a luxury home.
I know that there is the whole demand issue, but can that many people really be demanding housing that is so expensive.