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5 reasons real estate hasn’t recovered

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The housing bubble of 2006 burst in large part due to lax lending practices that led up to the housing recession. The collateral damage from these practices hammered personal fortunes through foreclosures and investment losses.

The devaluation of mortgage-backed securities tied to nonperforming mortgages kick-started the falling dominoes in this global financial crisis.

Now the mortgage lending industry is making up for their slipshod business practices by tightening credit standards to an extreme level. This has partly to do with regulations recently put in place that make one wonder if anyone consulted real estate professionals and economists before they were enacted.

It's commonly agreed that the easy-money lending practices that were in vogue before the downturn in 2006-07 should be left behind. Then, buyers didn't need to qualify to get a stated-income mortgage. Unrealistic teaser-rate mortgages were popular, and 100 percent and 110 p...