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The Real Causes — and Casualties — of the Housing Crisis
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The Real Causes — and Casualties — of the Housing Crisis

Knowledge at Wharton·@HashtagPLUS·about 1 month ago
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The U.S. is not about to see a rerun of the housing bubble that formed in 2006 and 2007, precipitating the Great Recession that followed, according to experts at Wharton. More prudent lending norms, rising interest rates and high house prices have kept demand in check. However, some misperceptions about the key drivers and impacts of the housing crisis persist — and clarifying those will ensure that policy makers and industry players do not repeat the same mistakes, according to Wharton real estate professors Susan Wachter and Benjamin Keys , who recently took a look back at the crisis, and how it has influenced the current market, on the Knowledge at Wharton radio show on SiriusXM . (Listen to the podcast at the top of this page.) According to Wachter, a primary mistake that fueled the housing bubble was the rush to lend money to homebuyers without regard for their ability to repay. As the mortgage finance market expanded, it attracted droves of new players with money to lend.…

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