One thing to note is that the bubbles formed in the wealthest areas of the region. Ca, Fl are obvious for their wealth. But even in places like Minneapolis/St. Paul, Las Vegas, Denver, Atlanta, local bubbles formed in areas not usually associated with the coastal bubble regions. Each of these is an island of realtive influence in their region.
I would suspect the “poorer effect” that has been discussed in the thread I posted about incomes and relitve wealth compared to those around you. Richer equals better, and everyone wanted a bigger better house than their neighbors, and wanted the cars and toys to prove it. Bubble prices with the HELOC’ed toys provided this and everyone pilled on cause it is hard to be the prudent one in a room full of friends discussing their new toys or the trip to disney world they just took their kids on.
The higher proportion of immigrants just helped drive demand even higher and became a self reinforcing cycle as more immigrants lead to more demand, more demand drove prices even higher, allowing for more toys, giving the area more economic power, attracting more immigrants. This is the usual rise of cities and population centers, but usually it is slower and not built on pure debt and speculation. It would have happened either way, the immigrants were just gasoline on a fire.
