Credit Supply and Housing Speculation

Atif Mian and Amir Sufi

No 24823, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Speculation is a critical channel through which credit supply expansion affects the housing cycle. The surge in private label mortgage securitization in 2003 fueled a large expansion in mortgage credit supply by lenders financed with non-core deposits. Areas more exposed to these lenders experienced a large relative rise in transaction volume driven by a small group of speculators, and these areas simultaneously witnessed an amplified housing boom and bust. Consistent with the importance of belief heterogeneity, house price growth expectations of marginal buyers rose during the boom, while housing market pessimism among the general population increased.

JEL-codes: E03 E44 G01 G12 G2 G4 R21 R31 (search for similar items in EconPapers)
Date: 2018-07
New Economics Papers: this item is included in nep-mac and nep-ure
Note: AP CF EFG ME
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Citations: View citations in EconPapers (16)

Published as Atif Mian & Amir Sufi & Gregor Matvos, 2022. "Credit Supply and Housing Speculation," The Review of Financial Studies, vol 35(2), pages 680-719.

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Journal Article: Credit Supply and Housing Speculation (2022)
Working Paper: Credit Supply and Housing Speculation (2019)
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