yes it is because of the booming economy.
low unemployment, low interest rates and more first time home buyers then ever in history made lenders bold and confident. this drove prices higher than value and tempted both lenders and buyers into risks.
so yes, the housing market was a bubble due to burst and yes, it was a result (at least in part) to our booming economy whose fundamental indicators range from good to record breaking.
the deficit went down over the last three years as the housing market soared to record heights. there is probably no correlation, but if there is any it is the opposite of what you infer.
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