The rise in home prices since the fourth quarter of 2009 is partly a result of the support from the government on the housing industry.  The government tax credit and the Federal Reserve Program worked to keep prospective buyers in purchasing houses that are affordable.

However, there is a lot of concern about the effect of these programs on home buying as well as the struggling recovery of home prices once these programs end this spring.   A lot of home owners and real estate professionals are concerned about buyers’ ability to buy new homes and home financing once the government programs end.  This can also cause foreclosed homes to bring down the prices of homes currently in the real estate market.

Although there is minor recovery in some parts of the country, withdrawing the governments financial support could devastate the real estate market and prices would continue to fall combined with a flood of new foreclosed homes.  The only way to keep these problems from happening is by extending the government programs or to provide home owners and buyers with some other incentive.