Even though the global economic crisis has ended, and the recession in the United States seems to have ended, and as we move towards a very slow recovery, still we are not out of the woods yet when it comes to real estate. And our authorities who are engaged in regulating the banks and the industry are not done getting to the bottom of which companies caused the problem either. In fact, they are still out investigating some of the largest corporations and banks in America.
Likewise, with huge number of foreclosure cases in the court system it is compounding the problem. Some banks are paying hundreds of million dollars in fines for filing foreclosure papers through contracted legal firms without the proper paperwork. But if you think real estate law in the United States is complicated after the last recessionary economic crisis, you’d be very interested to know that we are not alone here in our country. In fact, after the global economic crash the United States and China both spent huge amounts of money in stimulus to prop up their economies.
In China the central bank lent money to regional banks and municipal vehicles to prop up the construction industry, and a lot of that money went into real estate projects. People invested in these projects; apartments, business buildings, factories, and all sorts of other projects, and China created a real estate bubble due to all the money that was poured in. Unfortunately most of that money will never be recouped, and many of those loans have already gone bad, and those local banks are trying to hide the fact.
Meanwhile, everyone who invested is watching the property values drop like a rock, and they are losing most of the money they thought they had gained as the bubble got bigger and bigger. Will those people be able to sue the government for creating this property bubble, or the banks for propping up or even misrepresenting what was going on? No, in China you’re not allowed to sue the government, and they don’t have the same types of real estate laws that we have here.
Unfortunately, there were many investment banks from the United States which also got in on the action, and actually helped increase the building of that bubble, some of which have already gotten their money out, and others still have their money in and they are losing it. Those wealthy investors involved will also lose millions of dollars along with the hundreds of millions, in some cases billions of dollars being lost by US-based investment banks. Perhaps what the world needs is some international real estate laws that everyone can agree to globally. Indeed I hope you will please consider all this and think on.