Housing markets and the financial crisis of 2007-2009: lessons for the future

John Duca, John Muellbauer and Anthony Murphy ()

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: An unsustainable weakening of credit standards induced a US mortgage and housing bubble whose consumption impact was amplified by innovations altering the collateral role of housing. In countries with more stable credit standards, any overshooting of construction and house prices owed more to traditional housing supply and demand factors. Housing collateral effects on consumption varied, depending on the liquidity of housing wealth. Lessons include recognizing the importance of financial innovation, regulation, housing policies, and global financial imbalances for fueling credit, construction, house price and consumption cycles that vary across countries.

JEL-codes: O1 (search for similar items in EconPapers)
Pages: 58 pages
Date: 2010-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (88)

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http://eprints.lse.ac.uk/33613/ Open access version. (application/pdf)

Related works:
Journal Article: Housing markets and the financial crisis of 2007-2009: Lessons for the future (2010)
Working Paper: Housing Markets and the Financial Crisis of 2007-2009: Lessons for the Future (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:33613

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