The housing bust that began among the working class in remote subdivisions and quickly progressed to the suburban middle class is striking the upper class in privileged enclaves like this one in Silicon Valley.
Whether it is their residence, a second home or a house bought as an investment, the rich have stopped paying the mortgage at a rate that greatly exceeds the rest of the population.
More than one in seven homeowners with loans in excess of a million dollars is seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.
By contrast, homeowners with less lavish housing are much more likely to keep writing checks to their lender. About one in 12 mortgages below the million-dollar mark is delinquent.
Though it is hard to prove, the CoreLogic data suggest that many of the well-to-do are purposely dumping their financially draining properties, just as they would any sour investment.
This certainly goes against a big part of the media narrative (both left and right) about defaults. The leftwing coverage focused more on predatory lending while the right focused more on demonizing Freddie/Fannie. This study is looking more at actual defaults rather than being underwater.
Plus, let’s face it, it’s much easier to downgrade from a 1.5m home to a 800k home than it is to go from 500k to 300k. Lot of “want” vs. “need”.
This certainly goes against a big part of the media narrative (both left and right) about defaults. The leftwing coverage focused more on predatory lending while the right focused more on demonizing Freddie/Fannie. This study is looking more at actual defaults rather than being underwater.
Plus, let’s face it, it’s much easier to downgrade from a 1.5m home to a 800k home than it is to go from 500k to 300k. Lot of “want” vs. “need”.
This certainly goes against a big part of the media narrative (both left and right) about defaults. The leftwing coverage focused more on predatory lending while the right focused more on demonizing Freddie/Fannie. This study is looking more at actual defaults rather than being underwater.
Plus, let’s face it, it’s much easier to downgrade from a 1.5m home to a 800k home than it is to go from 500k to 300k. Lot of “want” vs. “need”.
This certainly goes against a big part of the media narrative (both left and right) about defaults. The leftwing coverage focused more on predatory lending while the right focused more on demonizing Freddie/Fannie. This study is looking more at actual defaults rather than being underwater.
Plus, let’s face it, it’s much easier to downgrade from a 1.5m home to a 800k home than it is to go from 500k to 300k. Lot of “want” vs. “need”.
