When prices in 2009 and 2010 (Duca V.,

When taking into consideration the financialcrisis, it is also important to outline the efforts which were made by thegovernment and authorities in order to tackle the latter. In this case, allactions which were adopted by the government served the main purpose toincrease the demand for houses in order to avoid the foreclosures. They triedto create some incentives for lenders, which should revise and reschedule termsand conditions of the troubled mortgages or at the same time to refinancemortgages which amount exceeded the market value of the house. These actionssomehow also had an influence on lenders to be less aggressive and to use thetool which represented foreclosure. Another dimension which is also reasonableto mention is US Congress and their decision to introduce temporary tax creditsfor people who represented homebuyers and overall this decision somehow had aneffect on housing demand and reduced the fall of housing prices in 2009 and2010 (Duca V., 2013). Another actor, which was engaged inthis process is Federal Reserve. The latter tried to lower interest rates inlong-term because when there are lower interest rates in long term it somehowpromotes economic activity and such kind of approach induced different actorsof the financial market to buy mortgage back securities (MBS) and in additionto this Federal Reserve bought some long term mortgage-back securities (MBS)until the job market had not become sustainable because the sustainability ofthe job market would give opportunity for borrowers to repay their mortgagesmore effectively.

These actions and moves from government and Federal Reserveand also with another policy responses played important role in the process ofstabilizing the housing market. In 2012 the prices for houses started to getnormal and also home construction sector started to rise because of the normalprices of the houses and the stabilization of the prices automatically hadeffect on the foreclosures because at the same time the number of the latterdecreased steadily and this event was very important because the decrease offoreclosures indicated that this long waited recovery of the housing market wason its way (Duca V., 2013).

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