The Senate bill passed today provides aid for homeowners on the brink of foreclosure, relief for beleaguered mortgage finance firms Fannie Mae and Freddie Mac, and something else: tax breaks for first-time homebuyers and a deduction for homeowners who normally aren’t able to itemize their deductions. Read the full article

Over the last fifty years, suburban neighborhoods outside of cities grew for a variety of reasons: families wanted more space than city homes provided, urban crime rates were higher than now (peaking in the 1960's and 70's), and the idealized vision of suburban life grew in popular imagination to become a mark of prestige. Less consciously, perhaps, suburban living was enabled by cheap gas and good roads; the "driveable suburb" within striking distance of city jobs became the ideal place in which to build a home. In the 1948 film, "Mr. Blandings Builds His Dream House," Cary Grant played an advertising executive whose family flees its cramped New York apartment for a country home in Connecticut. For Jim Blandings, trains enabled the commute; that wasn't the case for most workers who decamped from the cities. The ability to drive to and from work relatively cheaply made the suburban "dream house" possible. Read the full article

One of the consequences of the subprime debacle is a sharp rise in foreclosed properties. Some areas are especially bad off; in May, the majority of homes sold in the Sacramento area were foreclosures. Foreclosures nationwide were up 48% in May vs.the previous year (RealtyTrac.com), and in Massachusetts they were up 32% (ForeclosuresMass.com) over the same period. The rate in MA would have been higher but for a new law that went into effect May 1st, forcing lenders to delay foreclosure proceedings by an additional 60 days. There seem to be quite a few ads claiming that great deals are available through foreclosure sales. Is buying foreclosed property a "can't-fail" way to make money? Read the full article

Elsewhere I've written about the localized nature of housing markets. I just discovered that there's a very cool resource at the Boston Federal Reserve Bank website that lets you map foreclosure and subprime mortgage exposure for each MA city and town. Read the full article

Mark Twain is credited with saying a great many things that he may or may not have actually said. Among these is the observation that “People commonly use statistics like a drunk uses a lamp post: for support rather than illumination.” If Twain did say it, he might have had housing statistics in mind. If you pay attention to news reports, you're likely to hear widely-varying assessments of the state of the housing market. Who's right? Read the full article

The Wall Street Journal recently reported that former pro baseball player José Canseco has decided to let his Encino, California mansion, originally purchased for $2.8 million, slip from his grasp and into foreclosure. Canseco, who apparently lost $1 million of his equity due to a decline in property values, has expressed his sympathy for homeowners who are facing foreclosure due to their inability to pay off sub-prime mortgages.

You don't have to experience a foreclosure to regret buying a house. I've met people who weren’t at the brink of foreclosure who nonetheless realized too late that they had purchased houses before they were ready to be homeowners. I’m not going to speculate here about whether the housing market has finally bottomed. But I’d like to offer five questions that anyone thinking about a home purchase should seriously consider. Read the full article

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