New House Risks and Benefits Essay

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CheckPoint A New House Risks and Benefits 1) Which government bodies influence national fiscal policies that potentially affect the housing market? From my reading in my text I discover that the Federal Reserve is the major government that modifies national fiscal policies which can affect the housing market in the United States of America. This government body is in charge of money funding, change in interest rates and the money amount that is lent to individuals that are purchasing a home. This will change the actual price of houses. For example, of there are less people that are able to buy a home and be able to resale it, the prices of those homes that are already for sale may fall just to attract in more buyers. If the rate falls, there will be more money back into the economy, which means more people will have credit to buy homes, which pushes the housing business in up to par. 2) What are some national fiscal policies that can affect mortgage rates, housing starts and housing prices? According to “The National Association of Realtors”, the major problem that affects mortgage rates, housing start, and housing prices is the lending rates. If the FR will let lenders borrow money then this would help mortgages and housing starts tremendously and it would give some kind of start on helping the economy. When calculating mortgage payments it strictly is based on how high the interest rates are and if the interest rates fare high then so is the mortgage payment. If you have a mortgage loan and the rates are sky high then people are not going to be able to afford their already purchased home and also buyers will not be able to afford to purchase, which will cause the home and lenders to go under. 3) I recommend that people who are looking to purchase a home for the first time needs to do some investigating on what programs are out there to help them

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