Last week, the New York Times published an amazingly shallow article saying the “biggest defaulters on mortgages are the rich.” This contention is supported by a single pair of data: the owners of about 14 percent of homes worth more than $1 million are delinquent on their mortgages, while only “about” 8 to 9 percent of homes worth less than $1 million are behind in their payments.
The problem is, what is the Times‘ definition of “rich”? As one of the paper’s columnists pointed out a few days later, “Just because you have a million-dollar mortgage doesn’t make you a millionaire.” And if you live in a state that has a lot of growth-management planning, such as California or Florida, chances are good that you own a house worth more than $1 million simply because the median price of homes in many cities in these states was close to that much (or, in a few cases, more) at the peak of the bubble.
