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Originally Posted by joshbaumgartner
Not insignificant I don't think. If people can't afford to buy a house, they still have to live somewhere. More people are also choosing to buy an apartment (marketed as a condo in a lot of places) as opposed to a house. Does this indicate that more Americans are finding homes beyond their reach? Or are they just choosing to 'take less space'? I have single friends who own three bedroom suburban homes. Nothing against if that's what they want, but it does seem a wee bit inefficient in the big picture. If more people like this are finding a condo a better choice, I don't know that it is a bad thing. On the other hand, if families are being squeezed and simply can't afford to live in a home that fits their family anymore, then that probably is a bad thing.
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Given our population growth at some point the trend of people building and living in bigger and bigger homes will reverse. In places with highly dense populations people mange o.k. with significantly less space than the average person in this country.
Home ownership rates in this country are at all time highs even at current price levels. We have had an extended period of low and stable interest rates which has help a great deal. There are no indicators pointing to significant increases in interest rates or indicating that interest rates will become unstable.
It is interesting, but the subprime mortagage issue actually helped many marginally qualified people to buy a first home. Perhaps the net affect will be that many average hard working people who never owned a home before benefited at the cost of the "fat cats" on Wall St.
What is not being reported is the fact that the vast majority of these subprime loans are not in default and will never be in default. Some of these people will stabalize their credit, refinance with a "prime" loan, gain equity, and share in the American Dream of home ownership. To me that is a good thing.
