Skip to main content

Hillary Sin joins Mortgage Network as loan officer

National Mortgage Professional
May 12, 2008

Study shows: Ownership vs. rentals demonstrates that rental options should be a consideration in housing proposalsMortgagePress.comHomeownership, rentals, Center for Economic and Policy Research, National Low Income Housing Coalition, Census Bureau's American Community Survey As Congress debates solutions to the mortgage meltdown and ever more homeowners find themselves facing foreclosure, a report released by the Center for Economic and Policy Research (CEPR) and the National Low Income Housing Coalition (NLIHC) shows that in many bubble-inflated markets, homeownership remains a costly and risky proposition. The study, "Ownership, Rental Costs and the Prospects of Building Home Equity: A Comparison of 100 Metropolitan Areas," evaluates the median house price and fair market rent, as determined by HUD, for the 100 largest metropolitan areas. The study extends the methodology from an earlier study, "The Cost of Maintaining Home Ownership in the Current Crisis: Comparisons in 20 Cities," to the 100 largest metropolitan areas in the U.S. The new analysis shows the wide diversity in housing markets across the country. While many metropolitan housing markets continue to be subject to real estate bubbles, prices are not out of line with rents in large parts of the country. The findings of the report again show the importance of not relying on a one-size-fits-all solution to the current housing crisis. The report also notes the problems that many homeowners are likely to face finding quality rental housing due to its limited availability. "This is not just a homeownership crisis," said Danilo Pelletiere, NLIHC research director and a co-author of the report. "Data shows that the entire housing market. Across the country, rental properties are being foreclosed on and in many area, homeownership markets remain highly uncertain. Any policy to address this crisis must recognize the rental market as part of the solution." According to the report, which analyzed data from the Census Bureau's American Community Survey (ACS), the most inflated markets currently see monthly homeownership costs outpacing rental costs by as much as 300 percent. This creates a substantial and unnecessary drain on household income, especially for middle- and lower-income families. "This could mean that families may have to forgo health insurance or quality child care as they struggle to make their mortgage payments," said Dean Baker, co-director of CEPR and an author of the study. "Furthermore, since prices are still falling in these markets, many homeowners won't ever accrue any equity." The study projects that in the bubble markets, most homeowners will leave their homes with large amounts of negative equity. For example, it projects that by the year 2012, homeowners in New York will have $106,000 of negative equity and in Los Angeles, the shortfall would be $228,000. In these, and other bubble markets, households would benefit from proposals that attempt to provide affordable rental options as part of policy solutions. For cities where the costs of owning are much closer to rental costs, it is likely that a small amount of equity will be accrued. In these markets, policies that keep owners in their homes, possibly through some form of government-guaranteed mortgage, are preferable.
Published
May 12, 2008
Fannie Mae Extends Multifamily Protections Indefinitely

Fannie Mae announced that its multifamily COVID-19 forbearance program has been extended indefinitely to support multifamily property owners and renters experiencing financial difficulties due to COVID-19.

Industry News
Sep 27, 2021
LoanDepot Lawsuit Alleges Wide-Scale Fraud

‘One of the most egregious wide-scale fraud for profit schemes since the years leading up to the Great Recession,' a recent lawsuit claims.

Industry News
Sep 27, 2021
Federal Regulators Race To Address Cryptocurrency Risks

Cryptocurrency is quickly morphing into a volatile but widely embraced innovation, and federal regulators are racing to address the potential risks to consumers and the market. 

Industry News
Sep 24, 2021
MBA Initiative Seeks To Close Racial Homeownership Gap

Says its advocacy, partnerships & connections will help increase opportunities for minority borrowers

Industry News
Sep 24, 2021
Guaranteed Rate Opens New Branch In Southwestern Michigan

Guaranteed Rate expanded its presence in Southwester Michigan, after opening a new branch in St. Joseph

Industry News
Sep 22, 2021
Chinese Property Giant Evergrande Falters, Threatening U.S. Investors

On Monday, investors across three continents dumped their stocks, mainly out of fear that the world’s two largest governments — the United States and China — would undercut the beginnings of a global economic recovery. 

Industry News
Sep 22, 2021