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The ongoing destruction of the US real estate market

It worked fora while...

The rise of the mortgage servicing industry started in the 1980s and was one of the bricks in the wall that made the explosion of real estate lending - and prices of houses - possible.

Instead of servicing their own loans and living and dying with the results of their lending, banks were incentivized by Wall Street to sell their loans. Servicing was then passed on to a third party company.

So far so good.

Here's the problem:

1. The business is unregulated
2. It's been taken over by the criminally minded who've found that it's more profitable to do their job very badly and load up borrowers with fees and out them into foreclosure.

There was a multi-decade depression in real estate prices after the depression of the 1930s, the last time things like this took place.

it may be hard to imagine such a thing taking place now (just as it was probably hard to imagine a bear marketing in Florida real estate in the 1920s), but the system as it has devolved is virtually guaranteeing it.

It takes a while to turn the oil tanker around, but bit by bit people are getting the idea that going broke in exchange for the joy of home ownership is a bad deal and when that idea becomes common, it will take a full generation for that belief to turn around.

Personally, unless you are a serious wheeler and dealer, I would not touch real estate anywhere on the planet with a 100 foot pole.