Saturday, September 25, 2010

To stem foreclosures, let homeowners rent Real Estate Weekly - MarketWatch

To stem foreclosures, let homeowners rent Real Estate Weekly - MarketWatch:
"“With roughly one in four mortgages underwater, the loan-modification plans put forth so far have done little to help homeowners facing foreclosure,” said Dean Baker, co-director of CEPR and an author of the report, in a news release. The policy would benefit millions and provide many families with housing security, Baker said.

The report compares the savings from renting in 2010 versus the cost of paying a mortgage on a home bought in 2006 or 2007, in 16 major metropolitan areas. It looks at savings both before and after taxes.
View the report at the CEPR website.

“Ordinarily, the gap between owning and renting is not that large.” Baker said. “Due to the enormous run-up in house prices over the housing bubble years, however, ownership costs now vastly exceed rental costs in many of the bubble markets and homeowners in these markets have much to gain from having the opportunity to remain in a home as a renter following a foreclosure.”"

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