There Goes the Neighborhood

April 8, 2008 / Add comment

The subprime mortgage crisis appears to be spreading. It's affecting affluent areas, as well as more dilapidated neighborhoods, all over the country, but especially those high-growth areas on the fringes of big cities like Miami, Atlanta, and Las Vegas. In the Florida town of Three Lakes, ten homes on a street of 45 are facing foreclosure actions. Yglesias' gloomy but frank article notes that two groups are chiefly affected -- those who have selected financing options beyond their means and the investment promoters responsible for approving the loans. There's collateral damage, too, as houses near vacant or foreclosed properties carry reduced valuations.