I was going to say exactly the same thing (right down to the 500K). I, too, would go fixed rate.
Sure, you could go higher with some of the creative (?) loan products out there, but then the driver is the loan products, not the income levels.
That said, my feeling is it was mostly speculators and the boom itself that fed the boom. Booms in high tech have happened before (even though they don’t seem to be happening now). Adjustable and negative amortization loans have been around a long time. Stated income seems new, but other than that, speculators and psychology (and manipulation of same, witness the spin with the August new home sales numbers) seem to be the drivers to me.
