There’s an intriguing item that I found on the web site of a Florida newspaper that talks about efforts within the real estate industry to develop a 50-year mortgage (don’t laugh; I seem to recall that in Japan, 50-year mortgages became popular as home prices soared through the stratosphere). Lively debate in the article as to whether 50-yr mortgages will take off, with a lot of skepticism. My hunch is the idea, for better or worse, will take off as a solution to rising inaffordability in many markets (not that I don’t think that home prices won’t also come down in overheated markets). What’s troubling is the point that one critic makes that the buyers of these mortgages could be individuals trying to repair their credit, which is not necessarily the intended audience.
I’m curious what readers of this blog think about the prospect of 50-year mortgages.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.