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“During the housing boom of ’04 and ’05, you would hear people go out with real estate agents who said, ‘Your income lets you buy an $800,000 house,’� Holcombe recalls. Most people would go ahead and buy a house at the highest end of what they could afford, while just a fraction would hold back and say, “We’re only going to buy a house based on one income,� Holcombe says. The people who made that choice ended up coming out ahead during the turbulent economy, when many people lost jobs, he adds.
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