If you listen to the people who benefit most from government housing subsidies, there is never a good time to reduce or eliminate a source of government largess. If you’ve been reading this blog for very long, you have a finely tuned bullshit detector. Whenever you read the shrill cries of realtors, homebuilders, and high wage earning loanowners lamenting the dire consequences of reducing or eliminating the home mortgage interest deduction, your bullshit detector should tell you to discount whatever they say as the self-serving nonsense it is. The fact that the home mortgage interest deduction is in danger is [Read More...]

With housing markets, the elephant in the room is shadow inventory. Much has been written about the subject over the last several years. It’s been portrayed as an apparition among the housing bulls, as if the millions of delinquent mortgages simply don’t exist. Most bulls comfort themselves with fanciful notions of loan modification programs succeeding and some simply denying there is a problem at all. Well, there is a problem. Lenders underwrote trillions of dollars worth of mortgages to people who couldn’t or wouldn’t pay them back. Contrary to the popular myth in the mainstream media, it isn’t a problem [Read More...]