Tuesday, 27 November 2007

Jane Jacobs, Sub Prime Mortgages and Housing for Everyone

For the last ten days I’ve been rereading Jane Jacobs’s books, as I go into the home stretch on my next own book, Haussmann’s Boulevards to Jane Jacobs Streets. Right now I’m about halfway through Jacobs's last one Dark Age Ahead, published in 2004. In it she spends a lot of time worrying about the state of North American families, so many of whom are finding it hard to buy or rent decent housing. By the 1980s she says that the discrepancy between median family income and median house price had “slipped seriously out of whack.” Ninety percent of families could not afford to buy a “median” house. “It took only two people to produce children, but on average two by themselves could no longer afford to purchase or rent shelter for them,” she wrote.

What would she say about the sub prime mortgage crisis that has rocked US financial markets in recent months? She would be appalled, I imagine, but she probably also would understand just what motivated families to go so deep over their heads as they attempted to house themselves.

Keeping the whole financial house of cards from crumbling is a great problem currently, but of longer term concern is how to provide housing for ordinary folks, particularly housing which doesn’t involve more urban sprawl and increased reliance on the automobile. This is a problem that I hope to address in the Haussmann/Jacobs book, but so far it is very slow going.

1 comment:

Unknown said...

I also feel very sad about subprime mortgage crisis and also understand people, who had no other chance of buying house except using bad credit mortgages and other risky options. The controversy surrounding subprime lending has expanded as the result of an ongoing lending and credit crisis both in the subprime industry, and in the greater financial markets which began in the United States. This phenomenon has been described as a financial contagion which has led to a restriction on the availability of credit in world financial markets. Hundreds of thousands of borrowers have been forced to default and several major American subprime lenders have filed for bankruptcy.