The key is down payments aren't much of a thing anymore. People close on houses on Northern Virginia with 3% down as the norm now, and 1% isn't unheard of. Banks don't loan to anyone with a less-than-perfect credit score anymore, you must be super-prime to get a house in a urban or suburban area, so the fact that there's basically no risk in lending to the few people who qualify to get a mortgage (most hot markets have a big cash buyer proportion now) means that banks feel safe allowing lower downpayments. We're already well beyond 2006-like conditions, it wouldn't surprise me if the 0-down mortgage makes a comeback soon, but it won't come crashing down this time because liar loans and CDOs are ancient history.