XECO 212 A New House Risks and Benefits

XECO 212 A New House Risks and Benefits - The purpose of...

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(1) Title: A New House-Risks and Benefits Name: Jordan Miller Course: XECO 212 Due Date: Friday, August 20, 2010 Instructor: Eugene Kaufman (2)
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Governing bodies that would have an influence on national fiscal policies regarding the housing market is the Federal Reserve as well as the Department of Housing and Urban Development (HUD). The Federal Reserve Monitoring Committee (FRMC) is responsible for increases and decreases of all economic interest rates. If housing rates decrease, the demand of home buyers will increase, thus influencing the price a buyer might pay to purchase a home. The Department of Housing and Urban Development has been working to create and maintain roughly 115,000 jobs per the 2011 end of year fiscal budget proposal. An increase in employment will create an increase in income, thus stimulating the economy and ultimately causing housing prices to increase to coincide with the increase in income. A national fiscal policy that affects that affect mortgages rates is the lending rate.
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Unformatted text preview: The purpose of the lending rate is to determine which home buyers are better qualified to borrow money from the Federal Reserve to put into buying a home as well as startup costs. If interest rates are too high, people will turn to banks to borrow money because banks tend to have lower interest rates, thus causing the prices of homes on the market to drop. A recommendation I could have given first time home buyers pre June 2010 was to check into using the American Recovery and Reinvestment Act (ARRA) which was an act that Congress created for first time home buyers which would have given them up to $8,000 in tax credits. This act expired, unfortunately, in June 2010. Now, I would simply recommend doing your homework when considering purchasing a home. There may be a few options that exist that may be beneficial that are similar to the ARRA. One who wishes to save money and get the best out of their investment will check all avenues thoroughly....
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