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Housing Bubble or Subprime Meltdown?

I’m more and more convinced the recent housing disaster is more a result of ARMs adjusting combined with the so-called sub-prime mortgages which were written without proper income verification and, in many cases, untruthful appraisals. I pulled data on income, housing prices, and mortgage rates to produce the following:

It would seem that even though median housing costs rose four fold from 1981 to 2005, that wages (required to afford the payment), normalized to hours, actually decreased, in fact, by nearly half.

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