Losing Your Home 2.0

A lot of hand-wring over the notion of Americans "losing their homes" may be hype if this couple is typical:

As the foreclosure proceeds, the Mitchells have rented a house in Longmont, west of Platteville toward Boulder, Colo., that is nicer than the one they had owned. It's also less than five miles from Brian’s job as a project manager. Although the rent is more than their former mortgage payment, Brian, 43, said that, with gas savings, they are still coming out ahead. The move into town is allowing the couple to downsize to just one car.

“It was a tough decision for us to decide to let the house go into foreclosure, but I’ll tell you what, once we made it … it was very liberating, actually,” he said.

This article fits in with something Bob and I discussed: higher gas prices will reshape American lifestyles, and probably for the better in many ways. The people getting hurt aren't the neo-homeless, because the larger lesson of the housing bubble is that the ownership/renting ratio became unbalanced. But there are plenty of families that in some sense "should" be homeowners, who played by the rules, got good fixed-rate mortgages, but are going to suffer for the choice of buying in the exurbs. Those home prices are probably heading south permanently, and there is nothing fair about it.

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Loyal reader Michael Martin commented on a previous post that gas prices are likely to have another effect: entertainment hubs like Vegas are likely to see a drop in cross-country visitors. But will this mean lower spending on entertainment goods? Or will we just see shifting to local and electronic forms? This is an an interesting question, actually: what are good counter-cyclical entertainment sectors? Maybe the Olympic broadcasting deal is sweeter today than when it was negotiated.

Comments

[Joanne Cummings]

The geographer in me is following changes in movement and residence caused by gas prices with a lot of interest. The shape of our cities is by no means the only - or the standard - urban pattern in the world, and the combination right now of economic uncertainty, credit issues, gas prices, and even water scarcity may leave us with far different patterns than previously. Of course, mass transit systems reflect currect patterns, so I'd guess the less-well-off will be hit twice.