The Sub-Prime Demographic Shift

Focusing on the foreclosures shows only part of the sub-prime fiasco’s effect on our country. Yes, we’ll have displaced people, a swelling poverty base, and an overall loss of consumer wealth. It will impact our businesses, manufacturing sectors and economic stability. Rising food and gas costs (along with housing costs) make up the bulk of a consumer’s static monthly expenses. As the burden weighs in, some people are forced out of their homes, and others are selling rather than stay and die of the slow pinch, regardless of the type of mortgage they have.

We’re about to witness the death of urban sprawl.

(David) Stiff says home buyers’ attitudes have changed. The old rule was, “Drive ’til you qualify” - meaning they should go out from the city until they could get what they wanted at a price they could afford. - NPR

What’s happening now is completely different. Homes closer to cities with short commutes to jobs are selling well with tons of buyers and their home prices up 10% or more in some areas. The farther the home is from the city and the jobs it holds, the greater the plummet in prices.

Realtor Danilo Bogdanovic surveyed two rows of neat, new, brick townhouses on Falkner’s Lane. “These were selling for about $550,000 at the peak, which was about August ‘05, and they’re selling right now for about $350,000,” Bogdanovic said. “Fifty percent of this community has been ether foreclosed on or is facing foreclosure.”

For residents who work in the city, their commute is around an hour on trouble-free days. But that can extend upward toward two hours. - NPR

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