BUSINESS
03/28/2008 02:45 am ET | Updated May 25, 2011

"House Lust" Hits Home

Down the block from my home, workmen are finishing a new house. It replaces a bungalow that had measured about 1,500 square feet. The new home has a covered front porch, two fireplaces and a finished basement. It comes in at just under 5,700 square feet. What is it with Americans and their homes?

Everyone knows the direct causes of the present housing collapse: low interest rates, lax mortgage lending, rampant speculation. But the larger force lies in Americans' devotion to homeownership. It explains why government officials, politicians and journalists (including this one) overlooked abuses in "subprime" lending. The homeownership rate was approaching 70 percent in 2005, up from 64 percent in 1990. Great. A good cause shielded bad practices. The same complacency lulled ordinary Americans into paying ever-rising home prices. Something so embedded in the national psyche must be okay.

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