"A recent, worrisome working paper released by the National Bureau of Economic Research reported on the tinder of the last conflagration: the national sense tha

"A recent, worrisome working paper released by the National Bureau of Economic Research reported on the tinder of the last conflagration: the national sense that housing prices were going up every day and that there was no way that a buyer’s reach could exceed his grasp. It’s true that bankers made loans to Americans wildly unqualified for them — but the notion that buyers on the lower end of credit distribution began to default in unprecedented numbers isn’t accurate. In fact, the rate of default in the subprime market throughout the bubble and the bust remained steady compared with before the crisis. It was buyers from the top and middle top who account for the skyrocketing rate of default — and it wasn’t that they were buying bigger family homes that they couldn’t afford. It was that they were buying additional houses to flip for a profit, and when holding on to them stopped making financial sense, and with no personal and emotional connection to them, they began walking away in huge numbers."