So what do you do when house prices are slowly dropping and demand has stagnated? Create more demand! According to this article on MSNBC there’s a proposal in the states to change the way that credit scores are calculated to enable those that lack social security numbers or legal status as US citizens to get mortgages based on evaluating a prospective clientâ€™s utility bills, rent checks and other payments.
Should the new reporting methods gain wider acceptance on Wall Street and among secondary mortgage lenders like Fannie Mae, housing markets in places like Californiaâ€™s Central Valley would stand to gain the most, the National Association of Hispanic Real Estate Professionals said.
â€œGateway states like California and Texas will disproportionately benefit from the housing boom because so many of their residents are immigrants,â€ said Gary Acosta, the associationâ€™s co-founder, speaking from the groupâ€™s annual convention in Las Vegas. â€œBoosting home ownership among these populations is a positive contribution to the overall fabric of our society and our economy.â€
So with the current slowdown here, where can we turn to get more demand? Zero percent down and 35 year mortgages don’t seem to be doing it.