After the Housing Bubble Burst
36-minutes, 2008
Ref: 635

Watch Video
This is a follow up to the “30 Minuts” report on the “Bursting Housing Bubble”. In 2007, the property boom came to a grinding halt and booming house prices and sales are now a thing of the past, in Spain, the UK, Ireland and the USA. Developers, builders, estate agents, notaries, bankers, high officials in the European government and university professors discuss the real-estate crisis and the way it is sapping confidence in financial markets. To describe the new scenario, “30 Minuts” has returned to see how some of the people interviewed in the last report are getting by. The film crew also returned to the United States to look at how it all started: subprime mortgages and investment products based on mortgages, in both Europe and the US. Getting a loan is now harder and the growing sense of risk has meant higher interest rates and tougher terms. Money is not flowing as freely as it did a few years ago, and this is being keenly felt by housing developers and buyers who need mortgages. Central banks authorities have ruled out new hikes in interest rates for the moment as this might push the financial system over the edge. But returning to the days of reckless lending is not a solution either. In the words of Mike Larson, an American property analyst for Weiss Research, “Who knows what will happen if the Federal Reserve or the European Central Bank make access to credit too easy once again. Where will the next bubble form? That’s what we should be asking ourselves because if we now rescue the people who have created the problem, we’ll find ourselves facing another crisis later on.”