Dynamics of Housing Debt in the Recent Boom and Great Recession

Manuel Adelino, Antoinette Schoar and Felipe Severino

No 23502, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper documents a number of key facts about the evolution of mortgage debt, homeownership, debt burden and subsequent delinquency during the recent housing boom and Great Recession. We show that the mortgage expansion was shared across the entire income distribution, i.e. the flow and stock of debt rose across all income groups (except for the top 5%). The mortgage expansion was especially pronounced in areas with increased house prices, and the speed at which houses turned over (churn) in these areas went up significantly. However, the average loan-to-value ratios (LTV) at origination did not increase over the boom period. While homeownership rates increased for the middle and upper income households, there was no increase in homeownership for the lowest income groups. Finally, default rates post-crisis went up predominantly in areas with large house price drops, especially for high income and high- FICO borrowers. These results are consistent with a view that the run up in mortgage debt over the pre-crisis period was driven by rising home values and expectations of increasing prices.

JEL-codes: G01 G1 G18 G20 G21 (search for similar items in EconPapers)
Date: 2017-06
New Economics Papers: this item is included in nep-ban and nep-ure
Note: AP CF
References: Add references at CitEc
Citations: View citations in EconPapers (11)

Published as Dynamics of Housing Debt in the Recent Boom and Great Recession , Manuel Adelino, Antoinette Schoar, Felipe Severino. in NBER Macroeconomics Annual 2017, volume 32 , Eichenbaum and Parker. 2018

Downloads: (external link)
http://www.nber.org/papers/w23502.pdf (application/pdf)

Related works:
Journal Article: Dynamics of Housing Debt in the Recent Boom and Great Recession (2018)
Chapter: Dynamics of Housing Debt in the Recent Boom and Great Recession (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:23502

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w23502

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().