Subprime Bubble 2.0?
I’m addicted to ReVenture Consulting's YouTube page. He travels around the country giving color commentary on what his Real Estate analysis firm is finding. About two weeks ago, he revealed that over 1,000,000 mortgages didn’t go into foreclosure because of a Covid-era relief program.
Essentially, the US Government has been paying the mortgage for these mortgages with taxpayer money. When a mortgage borrower went into default they paid or tacked the debt to the back of the mortgage.
This has helped support prices of homes artificially. These are basically subprime loans. And if you remember 2008, that's a bad thing.
Did you know about that? I didn’t.
I highly recommend you watch the video here. https://www.youtube.com/watch?v=iKdtyDnGM-o
The video and the Wall Street Journal article it references seem to believe that the FHA portfolio “is far riskier than it was before the 2008 housing crisis.”
I’m not seeing this information many places to verify the numbers are correct. However, we aren’t seeing anyone at the Federal Housing Administration counter it as fake news. We shall see.