Did you Buy a House or are you just Renting from a Bank?

I'd like to see lenders work their way through these foreclosures and get healthier so that home prices can stabilize and resume appreciation.

In these inflationary times with April Gold futures at $1,000 and oil hovering around $110/barrel, by all accounts people need an inflation hedge, the most accessible one to the public is...........real estate!  During inflationary times, the gap between the rich and poor widens as the rich have access to inflation hedges while the poor, living hand to mouth with their dollars purchasing power shrinking, do not.

However, I still see banks approving 100% loans in my area with sellers paying for closing costs.  Guess what, these homes will be foreclosing 2-3 years from now, lenders are just prolonging the problem, not solving it at all.

My contention is this:  If a prospective homebuyer does not have $5,000 saved up to buy a house, the homebuyer has not demonstrated that they can manage money, and they have no margin for error if something goes wrong.  In addition, they have no stake in the house, so are not willing to work as hard to hold on to it.  Essentially, they are still renting, albeit from the bank.

I have no problem with people buying property any way they can.  Sometimes, it has to go hand in hand with a change in spending habits.  Look, if you buy this house, you have to give up going out to eat twice a week, and your daily frappucino!  Build up some equity in your home, build a cushion in case of medical emergencies or job loss.  I want lenders to continue to lend, but I do sit down with my buyers and really encourage them to put some money down on a house and work on building up equity.