Tuesday, October 28, 2008

Required Reading

Q3: Homeownership and Vacancy Rates, via CalculatedRisk


Preventable foreclosures ... center stage, yet again. Anyone else notice this theme, over and over and over again? Yet, our entire Treasury Department appear to have banks' capital on the brain, still.

"Innovation in mortgages", with luck, can be substantially substituted by the HUD program(s) and the already expanded use of Freddie and Fannie.

Should the government "target" a homeownership rate? No. Does throwing a huge number of people into the rental markets (or otherwise) and depressing home prices (and nominal bank debts) somehow "work" better? No.

[btw, I agree with the estimation approach, but the base estimate of the demand for housing looks low at circa 800K, for no-change in the homeownership rate. What about some amount of obsolescence in the housing stock? As best memory serves, the historical series during times when the ownership rate was steady suggests a higher number.]

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