Speculation, Flippers Fueled Housing Bubble: NY Fed

Law360, New York (December 12, 2011, 7:57 PM EST) -- Real estate investors with multiple mortgages played a bigger role than previously thought in pumping up the housing bubble whose collapse pushed the U.S. into a recession, according to a Federal Reserve Bank of New York report released last week.

The report examined borrowing trends from 2000 to 2010 and showed that a large share of mortgages during prerecession years — especially in hard-hit states like Arizona, California, Florida and Nevada — went to borrowers who already owned at least one house, particularly to those who sought...
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