Housing Starts in the News
“Housing starts” are kind of just what it sounds like, houses being started. It’s the number of new houses in construction. Every unit (house, apartment, condo, whatever) is counted as 1, so an apartment would be 1 start.
Recently in the news in the states there has been talk about many new housing starts as signs of a recovering housing market. Although some experts say this is just an illusion. States subsidise the construction of houses to keep people working and hold up an illusion of an improving market and to help stabalize the economy.
Technically all Americans are subsidising housing as taxpayers are footing the bill for now completely government controlled housing agencies Fanny Mae and Freddy Mac. These organizations are STILL backing home loans. Fanny and Freddie (and FHA) could cost US tax payers approximatlely $1 trillion.
I heard several references to the ‘FHA’ in discussion about banks and mortgages so I looked it up. FHA stands for the Federal Housing Administration who runs programs to promote home ownership.
This association hands out what are called FHA loans. These loans are insured against default. If someone lends money to a borrower they don’t have to worry about losing money if the borrower can’t pay because the FHA will pay. The FHA charges the home buyer and upfront and monthly fee to cover its back when someone defaults.
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