Is it true that the housing bubble was created because the housing market was practically 100% unregulated?
http://www.pbs.org/newshour/bb/business/jan-june09/andrews_05-21.html [Broken]...PAUL SOLMAN: Andrews applied for, and got, a no-ratio loan, in which his $2,500 monthly payments would consume nearly all his take-home pay.
EDMUND ANDREWS: A no-ratio mortgage in which literally I left the income space blank.
PAUL SOLMAN: Therefore, there would be no ratio.
EDMUND ANDREWS: Correct, yes, because there was an issue of my debt-to-income ratio. But if you don't have any income that you're declaring, you have no debt-to-income ratio. Problem solved. Even at the time, I'm going, "I can't believe this. Is this a great country or what?"...
Other than some of the above, talking of the housing market break-over, the sale value of property is dictated in large part by the size of the mortgage payment. Low interest rates reduced the size of the required mortgage payments bringing a larger pool of buyers to the market. The greater number of buyers inflated the price of housing.Is it true that the housing bubble was created because the housing market was practically 100% unregulated?