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If homeownership is the American Dream, then what’s foreclosure? The American Nightmare?
In the latest issue of BusinessWeek I wrote an article called “The Housing Bust’s Latest Blow,” calling attention to the recent decline in the U.S. rate of homeownership. My story cited new research published by the Federal Reserve Bank of Atlanta saying that the big boom in ownership from 1994 to 2004 was mostly related to looser lending practices rather than demographic changes in the number of households of home-buying age.
It stands to reason that as lending standards tighten up, the ownership rate will fall, and it already has. My article closed on Wednesday so I wasn’t able to include figures for the third quarter. Today, the Census Bureau came out with its numbers for the third quarter, showing that the rate stayed flat at 68.2%, vs. a peak of 69.2%. Many economists think the numbers are likely to dip even more before the housing crisis is over.
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.