Editorial from – HomeOwners for Better Building
The massive surge in foreclosures was inevitable. The creation of the “boom” and now the resulting “bust” in the real estate market is the brain child of the homebuilding industry that will remain a taxpayer’s burden for many years to come.
The recipe for enormous industry profits and eventual tragedy for thousands of American families and taxpayers was simple; build homes bigger, more grandiose with plenty of expensive upgrades, no down payment and innovative financing. Build them with the cheapest disposable materials and unskilled labor, while targeting first-time homebuyers who neither qualified for mortgage loans nor could they tell the difference between defective or deceptive, until they moved into their American Dream.
Top it off with a heaping portion of government insured mortgage fraud, created by big builder-owned mortgage and title companies, imitated by other small time mortgage fraud scoundrels
Add a twist of major building industry-backed Tort Reform law aimed at weakening consumer rights. Blend Binding Mandatory Arbitration clauses in the fine print of builder contracts, which denies buyers of their constitutional right of access to the courts and the ability to hold bad builders accountable.
Voila! America has a stunning wasteland of defective homes, fraud, and shattered dreams that defies all common sense. It was a recipe for disaster.
Shoddy or not, for the past ten years homebuilding has remained the chief indicator holding up the economy, and from the President to Congress no one wanted to disrupt the money flow. The result is the homebuilding industry grew more powerful and confident in building defective homes without consequences.
Now reminiscent of the 80’s – all taxpayers are paying the price.
In this age of corporate scandal it remains to be seen if the Enrons of the homebuilding industry well ever be prosecuted for their predatory business practice that created the slums of tomorrow.