Nov 07, 2008
How will the Obama Administration affect the real estate industry? Dr. Paul Light et. al. explain
07 Nov 2008
Posted by VAR
At the NAR Conference and Expo, Dr. Paul Light, a professor at NYU and an expert on presidential transitions, headlined a panel about how the Obama administration will address the housing sector. NAR’s Show Daily publication also ran this headline on the front page (see picture at right).
Here’s what Dr. Light had to offer:
- Obama transition is expected to be smooth, Bush administration is cooperative
- For the most part, appointments to housing positions won’t be known until late this year or early next
- It will take several more months to place sub-cabinet level appointments
- Obama is sometimes faulted for not making quick decisions, so his appointments could be very drawn out due to analysis paralysis
- Obama will have one of the most difficult transitions in history (Dr. Light compared Obama transition to Lincoln, who had inherited a situation where several states had seceded and Roosevelt dealing with the Great Depression)
- Economic stimulus will be a primary concern for Obama. Others initiatives could be Medicare, jobs, and energy, but there is not a lot of money for new government programs.
The two other panelists had this to say…
- Obama will be facing a bleak unemployment situation. Some are estimating up to 9 percent
- Obama will inherit more calls for regulation of banking and housing sectors
- Obama will inherit Republicans in Congress who are angry at Wall Street for causing their fall from power
- Obama will need to solve crisis in the confidence of lenders and borrowers
- Dealing with the cycle of foreclosures will be important. Obama will force lenders’ hands on modifying mortgage terms
- Obama may be faced with a situation where FHA is unable to manage risk better than other lenders. It might be necessary to rescue the rescuers.
- Said transition isn’t going as smooth as Dr. Light thinks, citing the fact that the memorandum of understanding between the Bush administration and the Obama transition team still had not been signed as of 3 p.m. today