[lbo-talk] Bartels on Frank, etc.

Doug Henwood dhenwood at panix.com
Wed Mar 8 11:58:07 PST 2006


Michael Hoover wrote:


>home-purchasing (misnomer to call it ownership in most cases) rates
>increased from low 60% range to high 60% range during same
>period, while general assumption seems to be that rise reflects those
>towards lower end of income scale being able 'to get into' a house, i
>wonder how much of it is relatively young, relatively affluent types
>who did well during 90 buying their first homes, ain't too many
>'starter' homes being built in orblando area, and rapidly rising
>property values have 'locked out' many people when it comes to
>trying to buy from existing housing stock... mh

I think the official line on this is more or less correct - that poorer people bought lots of houses in the 1990s and early 2000s, despite high and rising prices. The reason: very low downpayments and "innovative" mortgages (less than interest-only, for example). Note that the LAT piece that Jim Devine posted earlier said that a large share of debtors with adjustable mortgages are scared what will happen when the rate is adjusted upwards.

Doug



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