Pgh stays firmly (and safely?) on the ground
| October 2, 2007 | Posted by april under Community Development, Issues, Location, Western PA |
There have been at least a couple of news articles in the last month or more since the subprime market crash, reporting that the Pittsburgh region has escaped the kind of trauma and sharply declining home prices that have hit other regions hard. According to an article in the Trib, analysts from PNC Financial found that home price appreciation was actually higher in our region than the national average during some parts of this year. Of course, they attribute the much less precipitous fall to our region’s lack of population growth – well, I guess it is clear that the higher you climb the harder you fall. Perhaps this situation highlights the risks inherent in a speculative market, or greed, or lack of government regulation. I would like the main focus not to be on the fact that Pittsburgh sat out a historic rise and fall, but on the fact that we have plenty of subprime lending in this region (and there have been news articles covering the worst hardships that befall some borrowers). After all, isn’t that what caused the crash in the first place – not enough people could pay back the subprime loans (with high interest rates and burdensome debt to income ratios) on time.
I have heard that PA leads the nation in home foreclosures – I should look and see if there is a stat available for SWPA or by county. Rent-to-own schemes are around too. This is just a personal observation and I should find out if anyone has researched this, but I find that the signs (literally) of rent-to-own, as well as predatory home improvement loans, are most common in the north side neighborhoods. I’ve seen some in East Liberty too. People need better choices to house themselves – perhaps there is not enough livable rental housing available, or enough information about or guidance applying for government subsidized mortgage products that may be safer. I know someone who is a savvy professional with a college degree and had a hard time navigating the URA first-time homebuyer mortgage application process. Then, the banks that you have to go through to get the URA loan were yet another maze.
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