What Happened To All The Homes Lost During The Foreclosure Crisis?
After the Great Recession, hundreds of thousands of families lost their homes — but those houses and apartments didn’t disappear into thin air.
Journalist Aaron Glantz studied what happened after the crash for his book: "Homewreckers: How a Gang of Wall Street Kingpins, Hedge Fund Magnates, Crooked Banks, and Vulture Capitalists Suckered Millions Out of Their Homes and Demolished the American Dream."
Why Is A House A Good Investment For Most People?
- Housing is a cost that must be paid
- Homeowners build equity in something most people spend 30% to 50% of their salary on
- Over time a house becomes an asset
- Housing is the only "essential" that has a chance of going up in value
How Did The Housing Crisis Affect The Homeownership Rate?
"It went down not only in 2008 and 2009, but the home ownership rate also went down in 2010, 2011, 2012, 2013, 2014, 2015, until it bottomed out at a 50- year low in 2016," Glantz said.
Why Was There A Transfer Of Wealth After The Recession?
"You have 8 million homes that were lost during the foreclosure crisis and they didn't just disappear," Glantz said. "When you look at the people who bought these homes, you're not necessarily talking about mom and pop landlords here. Oftentimes, you're talking about major speculative interests from Wall Street."
Glantz said the rise of this new corporate class of homeowners is unprecedented in the U.S.
"We have three million homes and more than 10 million apartment units in America that are owned by LLC, LLP and shell companies," he said. "Back in the 90s, well over 90% of homes were owned by people. This is no longer the case."
Listen to the full conversation here