More on housing
A commenter on Greg Mankiw’s blog opines thusly on one of the various plans being floated to help financially distressed homeowners:
As someone who is saving for a down payment for a house in the DC area, I’m selfishly against it. I want the foreclosed houses coming on the market droping the prices.
Hmmm. About the only thing I can think to say in reply is: AMEN.
I don’t think anyone welcomes the prospect of an increase in homelessness, but giving your house back to the bank and re-joining the ranks of the renters is hardly the same thing. This is the problem I have with all the current schemes out there designed to help people stay in their homes: they’re anti-free market in a most fundamental (and unwise) way. And yes, they’re also very unfair to a class of people who tend to be (on average) even poorer than financially stressed homeowners: renters.