Housing boom to bust

There's always a dark cloud around the silver lining, it seems. As The Washington Post reports, the nationwide push toward homeownership is now sparking a nationwide rise in foreclosures:

For some American homeowners, the greatest housing boom in U.S. history has delivered riches. They repeatedly tap their homes for equity and use the cash to purchase granite countertops, a BMW, even a trip to the Super Bowl. But there's a dark side -- a sharp rise in foreclosures that is destroying the single greatest generator of personal wealth for most Americans. Foreclosure rates rose in 47 states in March, according to Foreclosure.com, an online foreclosure listing service. ...

State and federal regulators place much of the blame for the foreclosure problem at the feet of mortgage brokers and bankers, who have crafted ever-riskier ways for Americans with poor credit to buy homes. Interest-only and adjustable-rate mortgages account for 63 percent of new mortgages.

But many policymakers say the rise in foreclosures leads to a larger question: Is the push to boost homeownership — successive presidential administrations have strongly promoted it — backfiring? As home prices and personal debt rise to record levels, they note, homeownership has become an albatross for millions of Americans, destroying rather than creating wealth.