The NYT should have mentioned this fact in its article discussing a proposed bill that would tighten rules on mortgage lending. The article quotes Republican Representative Adam H. Putnam criticizing the legislation, saying that more flexible mortgage rules have increased homeownership. It would have been helpful to note that homeownership rates have been falling for the last year and are now back to the level they were at in the second quarter of 2003, before the worst of the abuses in the mortgage industry. (The drop in homeownership rates for blacks has been even sharper, falling 3.0 percentage points.) This decline is virtually certain to continue with foreclosure rates at near record levels in the third quarter of 2007.
--Dean Baker
