What do you do when you have a mortgage worth more than the property? Such is the quandry in which owners and lenders of mortgages have been stuck. And it is what caused The Great Recession, when the housing buble finally burst. Borrowers who were otherwise unqualified were sold loans to buy homes they would never be able to afford – since the lenders behind the loans never meant to hold onto them themselves, but rather “repackage” the loans to sell to others who repackage it again in their turn to sell onto others…until finally the pool of buyers dried up as borrowers increasingly defaulted on their loans.

You don’t have to be an industry insider such as Isaac Toussie to see the writing on the wall about this one. With all the defaulted mortgages and foreclosed homes, a terrible self-perpetuating cycle set in from which the economy has still not fully recovered. That’s not even to mention the other side of the matter, the fraudulent lenders and cynical gamblers involved!

Indeed, many, many other factors have contributed to the mess, and in a sense no one is entirely blameless. But the subprime angle just outlined is the most popularly understood narrative because it is actually the simplest to comprehend. For all that, what does the national outlook look like now?

Not good. It does matter that interest rates are lower than they’ve ever been. This means that people have to be almost perfect candidates in order to get a home loan. It doesn’t even matter that companies are making more money than ever before, as hiring remains frozen across the board. The upshot is that folks are too scared to bother investing in a home right now, preferring to rent instead for a change.

So for all the talk about The Great Recession being over, it’s 2011 and no citizen imagines that the immediate future is going to be any different.