Housing and the Financial Crisis

Housing and the Financial Crisis

Edward L. Glaeser and Todd Sinai

Print publication date: 2014

ISBN: 9780226030586

Publisher: University of Chicago Press

Abstract

Conventional wisdom held that housing prices couldn't fall. But the spectacular boom and bust of the housing market during the first decade of the twenty-first century and millions of foreclosed homeowners have made it clear that housing is no different from any other asset in its ability to climb and crash. This book looks at what happened to prices and construction both during and after the housing boom in different parts of the American housing market, accounting for why certain areas experienced less volatility than others. It then examines the causes of the boom and bust, including the availability of credit, the perceived risk reduction due to the securitization of mortgages, and the increase in lending from foreign sources. Finally, it examines a range of policies that might address some of the sources of recent instability.

Table of Contents

Postmortem for a Housing Crash

Edward L. Glaeser and Todd Sinai

2 The Supply Side of the Housing Boom and Bust of the 2000s

Andrew Haughwout, Richard W. Peach, John Sporn, and Joseph Tracy

4 Mortgage Financing in the Housing Boom and Bust

Benjamin J. Keys, Tomasz Piskorski, Amit Seru, and Vikrant Vig

5 A New Look at Second Liens

Donghoon Lee, Christopher Mayer, and Joseph Tracy

6 International Capital Flows and House Prices

Jack Favilukis, David Kohn, Sydney C. Ludvigson, and Stijn Van Nieuwerburgh

7 Can Cheap Credit Explain the Housing Boom?

Edward L. Glaeser, Joshua D. Gottlieb, and Joseph Gyourko

8 The Future of the Government-Sponsored Enterprises

Dwight Jaffee and John M. Quigley