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House Flippers Triggered The Us Housing Market Crash, Not Poor Subprime Borrowers

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ucbruin

Elite Member
Joined
Mar 11, 2014
Professional Status
Certified Residential Appraiser
State
Massachusetts
"Mounting evidence suggests that the notion that the 2007 crash happened because people with shoddy credit borrowed to buy houses they couldn’t afford is just plain wrong. The latest comes in a new NBER working paper arguing that it was wealthy or middle-class house-flipping speculators who blew up the bubble to cataclysmic proportions, and then wrecked local housing markets when they defaulted en masse."


http://www.msn.com/en-us/money/real...-subprime-borrowers/ar-AAqWEBx?ocid=spartannt

During the early '90's crash....
New home speculation was quite large in the early '90's......
 

Elliott

Elite Member
Joined
Apr 23, 2002
Professional Status
Certified General Appraiser
State
Oregon
I always recall a video about two school teachers who quit their jobs so they could wait out side new developments to be in the lottery to buy new houses, so they could make the expected $50K profit. Its tulip mania type thinking. Real value is someone educating your children, not buying on the expectation of phantom profit.

There were lots of other bad actors in the crash. Realtors get some blame, mortgage brokers, and of course Wall Street who famously said, "We can sell any mortgage you give us." Don't forget Greenspan, or Bernanke, and Barney Frank. It wasn't just credit worthy flippers.
 
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jay trotta

Elite Member
Joined
Feb 8, 2004
Professional Status
Certified Residential Appraiser
State
Connecticut
OMG........found a few gnats with saddle bags full of loot, they had to be part of the circle jerk Ranch, near zircon CA / PA and the other 48, they were deeply encrusted with the main scamologists World Wide and the loot moved so swiftly around the world, they are now just locating the lambskin carpet it was all hidden under. Ooops, carpet baggers, yup they are hard to find...........:rolf:
 
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