Local real estate experts support GSE bailout

Local real estate experts are applauding the government bailout of Fannie Mae and Freddie Mac, saying it will help re-energize the San Gabriel Valley's housing market.

Here's what some of them had to say on Monday:

"Interest rates have already dropped today," said Tom Adams, who owns Century 21 Adams & Barnes in Glendora and Monrovia. "They've come down three-quarters of a percent just on anticipation of this being the right thing to do. Now people can take advantage of the lower prices -- and get a good rate at the same time."

Adams said some home prices in the eastern San Gabriel Valley and Inland Empire have fallen 40 percent over the last 2 1/2 years.

"There are some phenomenal opportunities out there for people who are willing to take advantage of them," he said.

Chris Vigil, a Realtor with Keller Williams Realty in Whittier, was equally supportive of the government's move.

"I think this may do a great deal for buyers who have been sitting on the fence," he said. "We had a lot of activity during the summer, but this will stabilize things and keep interest rates lower."

More people may end up buying, but Vigil doesn't expect waves of homeowners to refinance their mortgage loans, even with lower interest rates.

"The rates might be down but a lot of people don't have enough equity to refinance," he said.

The big unknown is the price tag for all of this.

With the government takeover of Fannie Mae and Freddie Mac, U.S. taxpayers now
essentially own the bulk of the nation's mortgage market. This ownership could even lead to a big increase in the national debt -- to $15 trillion, up from just under $10 trillion now -- if things don't work out as planned.

Yikes!