Should We "Clunker" The Housing Market?

The cash for clunkers housing program is a bad idea, very bad and very stupid. You capitalists on Fox News want your free markets unless your free markets aren't working the way you want them to work, and then you want government intervention. I'm going to stop listening to Fox if you continue to be hypocrites. Also, governemnt incentives are what caused the housing bubble in the first place. Here we go again, another housing bubble. I wish you talking heads would shut up before you give Barney Franks anymore insane ideas.

We should Clunker our Congress! Throw the bumbs out, now!

Distorting (and destroying) the market - what fun!!

I think one reason the cash for clunkers program is working is the size of the credit relative to the size of the cost of the purchase. If the avg purchase price of a car during the cash for clunkers program is 30k then the consumer stands to save close to 15%...that is a real savings. If the same program was applied to homes we would be giving maybe 30,000 credit on a 200,000 house. If that was rolled out people would buy houses like carzy. If you compare the two programs level of acceptance I think it boils down to the impact the credit has on the total price of the item purchased (15% for a car and 4% for a home). If the government is giving away money to save the auto industry why not the housing market as well (oh and drop the first time provision in the home program...do they have a first time home buyer limit on cash for clunkers)? Maybe if realtor's unionized we would have a better home purchase program :)

Cash for Clunkers or Bail for Bunkers or whatever you might want to call it but there is alot of investment capital and charitable capacity being eaten by this housing market. I speak from the personal experience of feeding a four bedroom French Country Ranch with Full Daylight Basement over $60k in the last 20 months. No lookers even to occupy the property as tenants. Not fun. That $3k could sure be used in better ways.

No idea is perfect and no program has truly broad reach--but our economy needs all possible support. The cash for clunkers deal puts customers in dealer showrooms, you can trust the marketplace to increase sales from that point. New car sales are a market leader that lifts the entire auto market and has broader ecoonomic impact with consumers, particularly because the media tracks monthly results so closely.  The problem I see with incentivising home sales is that lenders will only finance top credit. There are no GMAC-Ford Credit lenders in the housing market, and we don't need the government to subsidize that credit. However, anything that will lift home sales appreciably would be welcome now, so keep the thinking caps active!

The House just authorized another $2 billion. My estimate is that there are $5 billion in car deals sitting on dealers' desks waiting to process. We won't be doing any deals today or this week-end. Had the appropriation been open-ended we would. Having a good feel that the additional $2 billion is already used up even before it is appropriated, no need to go on the limb. Our manufacturer sent us an e-mail to "do the deals." We asked if they would guarantee the payment of the CARS rebate. The said "No." So we say, "So sorry. It's not your money to lose, it's not the customers' money to lose, and the taxpayers have a limited liability up to the appropriated amount, so we'll just conduct business without the Cash for Clunkers program."

I fully agree that a "stimulus" should be seen largely in the form of tax breaks and rebates. Giving the American people more of THEIR money to spend is an easy way to perk up the economy. However, this "cash for clunkers" program is waste. Sure it gets money into the hands of consumers, but only a limited fraction of the consumers are going to be eligable, and it only helps one small part of our economy, new car sales. Beyond that, these old cars are not reused to their best ability, they are scrapped. And getting old cars off the road will hurt those at the bottom looking to buy a car for less than 4500, and it will end up hurting the auto parts and repair industries (oh the wonderful land of unintened concequences). It would be far better to just hand the extra money out to the consumers and let them "stimulate" which parts of the economy helps them the most. Luckily, right now, this "cash for clunckers" program is small enough those searching for older, cheaper cars, as well as the auto parts and repair companies are probably not being hurt significantly by it, yet. If this gets expanded to take a large portion of the <$4500 cars off the market, it will begin hurting people. We don't need something similar in the housing market. We just need government to stop trying to change the rules. Ie. The desire to buy a house is lessened when the $8000 tax rebate may go up to $15000...

When word gets out how this Cash for Clunkers for autos program is being administered and what a cluster it is to abide by, the real estate people will run for the hills. To say that today there is mass confusion in the car business is to be polite. Community organizing doesn't seem to translate to organizing government to run anything well.

We need a "trickle up stimulus plan". Why bail out the banks and lenders, etc. who need it for reserves. We need to get stimulus money into the hands of the consumer who are 70% of our economy,and when they spend it it will eventually trickle up to the guys at the top. This is how a free market works, from the bottom up! The clunkers deal does that. What would have happened if the cash was just given to the dealers to shore them up? Yes! That's right! Nothing! And that is why the bailout money should be used to stimulate the consumer, who in turn will start spending and stimulate the economy! Not rocket science!

It's time to stop this tremendous waste of $$$ in the name of consumption at great expense to this country by taking on an unfathomable amount of public debt that is mortgaging our future. These stimulus dollars would have been better spent on pushing technology frontiers in all forms of alternative energy/power sources & usage including nuclear, wind, solar, & alt. fuels including CNG for vehicles, etc.; all options for energy & its use should be on the table with an attitude that "one size or two fits all" is not an acceptable energy policy. Let the marketplace sort out the most efficient options for a given situation rather than dictated by Washington. We need leadership not a concentration of power that just pushes money to their friends at the expense of all that are not benefiting from these stimulus dollars and which ignores our strategic needs as a population, an economy and as a country.

Why were our leaders surprised by the success of such a program? Why are they obsessed with banks and wall street? Forget the banks, the insurance companies or government works projects. Over 70% of the US economy is the consumer. Get money directly into the hands of the consumer. Bypassing the money management companies will shorten years off the jobless recovery.

Brian - "Eliminate any needless caps on who is eligible" - let's get back into the sinking ship! Unfortunately, people without jobs can't buy anything other than basics. A "jobless recovery" is beyond my understanding.

This is a terrible idea. Government meddling is what screwed up the housing market in the first place. Continued meddling is driving the bottom out of the market. By that, I mean low end and entry level housing is unsellable because of the low interest rates and incentives. An unintended consequence of this intrusion into the market place is that condo owners, such as myself, are stuck in their property. All you are doing is driving the price of an entry level home up. Those of us who own homes below that value are no longer attractive to first time home buyers.

No we should not Cash for Clunker the housing market. If it's such a big boost for car makers then why don't they run the program without us paying for it. If every home sale adds $58,000 to the economy then lets rebate people some of that money. If you gave $18,000 back to the seller you only need to sell 6 more houses to make up the rebates.