That’s the question asked by Yoomie Ahn, a member of the Board of the Virginia Housing Coalition in a column on HOME’s Take Me Home Virginia site.
The shrinking middle class isn’t anything new or surprising. Ahn references an article in The American (the magazine of the conservative American Enterprise Institute) called “What if Middle-Class Jobs Disappear?”
Fun story — well, sort of — in the Times about college students renting luxury homes for a pittance, thanks to the down market:
While students at other colleges cram into shoebox-size dorm rooms, [they] come home from midterms to chill out under the stars in a curvaceous swimming pool and an adjoining Jacuzzi behind the rapidly depreciating McMansion that they have rented for a song.
The Michigan Sentiment — aka the Thomson Reuters/University of Michigan Index of Consumer Sentiment — jumped more than expected for November, meaning consumers are starting to feel a bit better about the economy. It’s good news for a Friday, for sure.
The Thomson Reuters/University of Michigan preliminary index of consumer sentiment climbed to 64.2 this month, the highest since June, from 60.9 in October. The median estimate of economists surveyed by Bloomberg News called for a reading of 61.5.
While Fannie and Freddie are still reeling from helping bail out the nation’s banks, their cousin Ginnie Mae had a record year (its fiscal year ended on September 30), showing $1.18 billion in net income — double last year’s income of $541.5 million.
According to RealtyTrac, October foreclosures in the country were down 31 percent from last year, but up seven percent from September. So you can spin the story whichever way you like:
According to the latest Fiserv Case-Shiller index, the median mortgage payment for a single-family home is 40 percent lower today than it was at the market peak in 2006 — $700 per month compared to $1,140 just a few years ago.
Further, Fiserv predicts that housing prices will decline another 3.6 percent in the first part of 2012 before rebounding 2.4% in the second half of the year. (How it can be that specific is hard to guess.) This pushes back the firm’s predicted recovery time; its August report predicted “a broad-based recovery for housing that will begin in early 2012.”
A budget proposal in the U.S. Senate would “bring about the lowest funding level in a decade to the Department of Housing and Urban Development” as the folks at HOME Virginia put it. Among other things, that would mean cuts to HUD’s Housing Choice voucher program, which helps thousands of low-income families (about 42,000 in Virginia) afford their homes.
Both Fannie Mae and Freddie Mac reported that their holdings of REO properties declined in the third quarter, continuing a trend that’s been ongoing since late 2010.
Here’s a nice graph from Calculated Risk:
Interesting column from Reuters’s Agnes Crane, “U.S. housing has added problem: mortgage insurance.” Why interesting? Because the trouble she describes hits right in the issue of down payments — specifically, the idea of a 20 percent-down requirement for the best rates.