The result of the above will mean millions of people will not be able to get rid of their homeloans. However, when they default on the loan and possibly give up and hand the keys back to the bank/lender, the result will be that these lenders end up with thousands or millions of properties that they cannot sell (or at least sell at realistic prices). What happens then?
What happens next is that the Government in 12 months time will have to step in a rescue the housing market!! Buy backs, freeze repossesions or reduce interest rates (0% ???) who knows.. The fall out from the last few weeks in the financial markets wont really be fully felt in the housing market until this time next year, so fingers crossed the governement can at least get some sort of a plan together... What the Government can't allow to happen is to let repossesions carry on picking up pace at the rate they are at the moment. If it does the housing market in 6 months will be in free fall, as who wants to buy a house at market value when you can buy a repossesion at 30% lower?! If it carrys on going this way, it will be a buyers market which can only push prices down further..
On a brighter note, at least the likes of property ladder, how to sell house and homes under the hammer might finally be off our screens for the time being!!
