Credit conditions have caused real estate booms and busts, owing to an underpricing
of credit risk aided by regulatory arbitrage and shadow financing. Across countries, real
estate price and credit bubbles have reflected not only inelastic land supply and thin
trading, but also the amplification of shocks via backward-looking price expectations
and financing based on distorted prices. Macroprudential lessons from the Great Crisis
include preventing excess real estate financing and limiting the amplification and
correlation of risks. Nonetheless, the costs and benefits of recent regulations require
re-evaluation amid an ongoing need to address correlated risks from shadow financing
and securitization. (JEL G28, E3, R31, R33, R38)
1010 Affordable Housing Architecture Asia Australia bonds Borrowing Constraints California Canada China coastal markets cold storage Colombia Commercial Brokerage Commercial Real Estate commissions Congestion consumer bias covid-19 CRE credit card market Credit Default Swaps Credit Insurance Credit Risk Transfers Culture data centers Debt Market Demand Demographics Density Development Discrete Choice disruption Diversity e-Commerce Economic Corridors economic policy economics education election studies Equity Market Ethnic Factors Europe Fannie Mae financial asset management Foreclosures France Freddie Mac general equilibrium Global global economy Global Financial Crisis great depression Great Recession healthy buildings Hedonic hospitality Housing & Residential housing boom Housing Disease housing prices Housing Supply Identity Income Inequality India inflation Inter-generational mobility interest rates Investing Lagging Regions land use regulation Language life sciences Macroeconomics Microeconomics Migration Minimum Payments Mixed-Use Mobility moral hazard mortgage insurance mortgage market Mortgage Rates Mortgages Multi-family Nation Building Non-Traditional Mortgages office sector pension funds Placed Based Policies Political Risk Price Discovery public health public policy Public Schools real estate brokerage Real Estate Investment Real Estate Investment Trusts Recession Rental Retail Retirement reverse mortgages risk management risk-shifting single family housing Slums Sorting South America Spatial Regions spillover effect stimulus package Sub-Prime Mortgages Supply Chains Sustainability Technology telecommunications unemployment United States Urban Urbanization welfare work from home