Millionaires minutiae

Published: December 24, 2007, 11:37 am

A little background re millionaire households: One commenter wonders if there was an effect from the changing housing market. First, the Claritas data are from 2006, long before the housing market tanked. Second, it says its calculation of income producing assets (IPA) does not include home equity. Third, we track this trend based strictly on the internal order of the rankings, not on the actual number or share of households from metro to metro, which is NOT comparable from 2005 to 2006. Nonetheless, here is Claritas' explanation of its formula: Over the past three years, homeownership rates and home values have increased, causing a decrease in IPA. Households have been using income-producing assets for housing down payments, home purchasing closing costs, and mortgage payments. These housing costs come out of IPA and eventually move into home equity, and home equity is not part of the IPA model. Additionally, IPA is based off of a three-year average of survey results. This

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