The Government’s Objectives
Reducing the incidence of homelessness in its territory is an objective of every government. This is one of the reasons for its involvement in the management of the housing market. Furthermore, it also has both macro- and micro-levels of concerns.
On the macro-level, it has to prevent the housing market from triggering an economic downturn. On the other hand, it aims to improve the quality of life of its residents. This is where the finance sector matters.
Recession and Housing Bubble
It is no secret that the mortgage industry was one of the culprits in the major recession back in 2008. After the event, different changes in the mortgage application processes were introduced. The recession and the succeeding changes affected all players in the real estate industry: homebuyers, lending institutions and brokers.
Apart from recession, the housing bubble is another problem that the government wants to avoid. This is best characterized by the decrease of affordable housing options. If the so-called bubble bursts, you will be left with mortgage choices with high interest rates so you can have initial payment for your prospective home.