Business: Housing High

Why homes are the hero

Daniel Brill, chief economist at the Treasury Department, was startled when his son phoned to say that he had lined up financing for his first house, which is in the Boston area. The cost: 9.75% mortgage interest—plus 2.5 points (a one-time finance charge). Admits Brill: "I gulped. I remember bitching when I had to give up my 4% G.I. mortgage."

Though lots of Americans are gulping at the high cost of mortgage money, housing remains one of the brightest spots in the economy. Earlier this year, the Administration privately forecast about 1.8 million "starts" in 1978. So far,...

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