Young Adults Buying Larger Homes Through Credit Deregulation

According to the Wall Street Journal, 36% of renters aged 18-34 said they expect to buy a home within the next year. This, in my opinion, seems rather presumptuous in the down economy we are currently experiencing, but due to credit deregulation at many banks, borrowers can borrow for 3% down with government backed loans, and 10-15% down for jumbo loans. Jumbo loans are loans over $417,000 in most parts of the country, and $625,500 in high-price areas. I believe lack of regulatory oversight contributed to the subprime mortgage bubble of 2008, and I am hesitant to feel positive about this much debt going into the hands of financially overconfident young professionals. However, if the economy continues its rebound on schedule, which is anything but certain, real estate professionals will be in a key position to capitalize on their client's dream.

http://www.wsj.com/articles/young-adults-going-for-jumbo-loans-1430321276