Americans are feeling a false sense of wealth as the property market booms, with the increase in prices and lower mortgage rates it is possible for the regular American citizen to feel wealthy. The problem is that this boost has been driven by the bailout provided by the Federal Reserve and the properties are being bought by banks and other large companies and rented back to the original owners. The availability of properties to purchase does not meet the latest demand and people who are renting are being hit with higher rentals even though their income has not changed.
It is important for people to consider the long term consequences of taking out a mortgage, especially now when their affordability is higher because of the lower interest rates, buying a home in an area that you would not normally be able to afford does not make you any wealthier, in fact you could land up having bigger problems than status later on because the bubble has to burst sometime and mortgage rates will increase accordingly. The article I read on My Budget 360 is informative and interesting.