Most folks in the real-estate industry agree that banks need help from the federal government, but they’re concerned that the bailout plan is being rushed through Congress too quickly.
It’s critical to get liquidity back into the financial system, said Ed Boxer, principal of Essex Financial Group, which is having a tough time finding lenders to finance commercial projects.
“No one knows how to price a loan today,” Boxer said. “The whole financial system is just constipated. It needs a major laxative.”
That laxative is coming in the form of a $700 billion bailout from the federal government, a move Boxer said is necessary.
“I have concerns that there needs to be some oversight,” he said. “The secretary of the Treasury wants total discretion, and that concerns me.”
That’s a sentiment echoed by David Zucker, a Denver condominium developer who thinks the plan is being rushed through too quickly.
“There will be many unintended consequences, not the least of which is making the guys rich who got us into this mess,” he said. “We’re building the plane in midair. We don’t know whether we’re going to get a fighter or a bomber or a glider that doesn’t have the power to go in for a smooth landing.”
Developer Buz Koelbel said the government needs to support the financial and real-estate markets but is concerned that the plan is not well thought out.
“Whether it’s commercial or residential, this will affect every sector of the real-estate industry for many years to come. Collectively, we are the largest industry in the country,” he said.
Mike Welk, a broker with Your Castle Real Estate, said the plan doesn’t help enough people or get to the root of the problem, which is financial irresponsibility.
Lenders were too quick to finance unqualified buyers, and unsophisticated buyers didn’t understand the terms of their loans, he said.
“These corporations are asking for as much help as their homeowner customers are,” Welk said. “The government is giving the money to help bail them (corporations) out, but they’re not extending the same to their own clients.”
Margaret Jackson: 303-954-1473 or mjackson@denverpost.com
