Housing.com News, Analysis & Opinion: Friday Housing News: Hotel FEMAville

And yet, if that article is any indication, even the hoteliers would give up their business if it could get the hurricane survivors into real housing. Listen to this:

"Ninety percent of the people staying at my hotel don't have flood insurance, unfortunately, so they're not getting reimbursed," Poole said. "They want to go home but they're waiting on FEMA trailers and have no other place to go."

Maybe that's because some of the trailers that FEMA has ordered--at taxpayer cost--have contaminated water supplies.

This is going from the absurd to the absolutely egregious. I really think FEMA is deliberately screwing this up. To what end, I cannot imagine. Could it simply be that because FEMA is getting taxpayer money to fund these no-bid contracts, that they feel they can spend it as wastefully as possible? Or do they think that the boost to the hotel industry is somehow going to improve the economy?

Something else to think about--the more money people spend paying for expensive hotels, the less money they'll have for paying bills or mortgages that will be due even with disaster relief in place. That means payments will be missed, credit scores will drop, and those people who want to put money down for a new home will face far more expensive terms. Several consumer agencies appealed to the major credit bureaus to allow usage of "pre-disaster" credit scores, to no avail.

If I can put my tinfoil hat on for a moment, I'm really thinking that this is a deliberate move by lenders and the industry to prop up the sagging market. By forcing Katrina survivors to pay higher loans at more restrictive terms, the market will get an influx of capital that it's losing as home prices fall. Or so it thinks. The flaw here is that they're trying to get more money from people who have lost it all.

Thank heavens those "no-bid" contracts are being reevaluated. We'll see if they get it right this time.

Credit to the blog of Housing Finance for some of this information. Thanks, guys.

This demonstrates a few profound aspects of the bubble market. For D.C. to be turning apartments into condos at such a speed indicates that even though housing prices are falling there, the speculative demand is absolutely ignorant to the larger trends of the market. People who might not be able to afford those expensive condos will get knocked out of their homes, or forced to take on seriously "creative" mortgages to get in on the action.

If California--the standard-bearer for expensive housing in America--can experience a bubble puncture and actually spin straw into gold, that's a good sign for buyers around the country. Demand will increase as prices go down, and if lending standards actually continue to grow more strict, that means people who want a home will actually have to put the work in to get it. Saving money, improving credit, shopping around...y'know, all the things the bubble tried to make you forget about.
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The National Multi-Housing Council is calling FEMA out for failing to take advantage of numerous vacant apartments and moving survivors out of expensive hotels and motels. Call me a cynic, but I suspect that has everything to do with the boom profits to the hotel industry. And yet, if that article is any indication, even the hoteliers would give up their business if it could get the hurricane survivors into real housing. Listen to this: "Ninety percent of the people staying at my hotel don't have flood insurance, unfortunately, so they're not getting reimbursed," Poole said. "They want to go home but they're waiting on FEMA trailers and have no other place to go." Maybe that's because some of the trailers that FEMA has ordered--at taxpayer cost--have contaminated water supplies. This is going from the absurd to the absolutely egregious. I really think FEMA is deliberately screwing this up. To what end, I cannot imagine. Could it simply be that because FEMA is getting taxpayer money to fund these no-bid contracts, that they feel they can spend it as wastefully as possible? Or do they think that the boost to the hotel industry is somehow going to improve the economy? Something else to think about--the more money people spend paying for expensive hotels, the less money they'll have for paying bills or mortgages that will be due even with disaster relief in place. That means payments will be missed, credit scores will drop, and those people who want to put money down for a new home will face far more expensive terms. Several consumer agencies appealed to the major credit bureaus to allow usage of "pre-disaster" credit scores, to no avail. If I can put my tinfoil hat on for a moment, I'm really thinking that this is a deliberate move by lenders and the industry to prop up the sagging market. By forcing Katrina survivors to pay higher loans at more restrictive terms, the market will get an influx of capital that it's losing as home prices fall. Or so it thinks. The flaw here is that they're trying to get more money from people who have lost it all. Thank heavens those "no-bid" contracts are being reevaluated. We'll see if they get it right this time. Credit to the blog of Housing Finance for some of this information. Thanks, guys. In other news, the National Association of Realtors reports that California home prices may be falling, even as the Washington Post reports that the condo conversion craze shows no signs of letting up. This demonstrates a few profound aspects of the bubble market. For D.C. to be turning apartments into condos at such a speed indicates that even though housing prices are falling there, the speculative demand is absolutely ignorant to the larger trends of the market. People who might not be able to afford those expensive condos will get knocked out of their homes, or forced to take on seriously "creative" mortgages to get in on the action. If California--the standard-bearer for expensive housing in America--can experience a bubble puncture and actually spin straw into gold, that's a good sign for buyers around the country. Demand will increase as prices go down, and if lending standards actually continue to grow more strict, that means people who want a home will actually have to put the work in to get it. Saving money, improving credit, shopping around...y'know, all the things the bubble tried to make you forget about. fema