PhilMur's thoughts on biz/tech/money/life

With all of the talk about people over-leveraged, and in homes too large for them, it’s interesting to find that many of Bluefield, West Virginia’s residents are quite a bit different. Unless you’ve been skiing up in West Virginia, or taken Interstate 77 up through the state, you probably know very little about the town of Bluefield. But there is an interesting fact about the city’s residents that has everything to do with personal financial management. Read what USA Today recently reported about them:

In 17 locations around the U.S., many made up of small cities surrounded by large rural areas, 50% or more of home owners own their homes outright and therefore don’t have to worry about rising monthly payments or owing more than their home is worth, according to a USA Today analysis of Census data. In 123 areas, 40% or more don’t have a mortgage, and nationwide the average is almost a third. The analysis shows that areas containing higher percentages of zero-mortgage home owners are scattered across the country, from Somerset and Johnstown, Pa., to Lumberton, N.C., Sebring, Fla., and Lufkin, Texas. Most have a central city of fewer than 50,000 people. Higher percentages of mortgage-free home owners are less likely in rapidly growing areas such as Washington, D.C. (17%), Atlanta (19%) and Las Vegas (20%). Many of the places that have a high share of no-mortgage home owners never enjoyed the boom that sent housing prices soaring across much of the nation. As a result, there was no bubble to burst. “Not always do we have the best of times, nor the worst of times,” says Mark Henne, city manager in Bluefield, W.Va., a coal country town that ranks at the top with 57% of its home owners mortgage-free. “We’re not experiencing the defaults that the rest of the country is.” [Emphasis added]

- USA Today (“Some Parts of U.S. Escape Housing Mess”, 11/17/08)

In order to have paid down mortgage balances without maxing the equity right back out for merchandise, cars, or home improvements, Bluefield’s residents have undoubtedly done without some of the things others wouldn’t dream of living without. In fact, the path to financial stability is costly, particularly in the short run. But, as I will continue to argue in this blog, well worth the cost.