Purposefully wiping out much of the value of low-priced homes from 2008 to 2012 had obvious primary consequences but also some subtle secondary consequences.
I don't see the particular paper I'm thinking of, but the Fed paper does seem to find a similar pattern. The more equity the homeowners have, the less likely they are to move, even when prices were suppressed, which I think suggests tactical concerns about taking a loss on the house are less important than the flexibility have having low or no payments to worry about or access to capital.
Maybe Kevin Erdmann should write an op-ed that what L.A. and L.A County (Altadena) should do is completely un-zone the flattened-burned areas, save for designing in some amenities like parks and mass-transit stops.
What L.A. area needs a few forests of high-rise condo complexes....
Brookings (https://www.brookings.edu/wp-content/uploads/2021/04/A-Comparison-of-Renters-and-Homeowners-in-Recent-Decades-2.pdf) and the Cleveland fed (https://www.clevelandfed.org/publications/economic-commentary/2013/ec-201309-keeping-the-house-or-moving-for-a-job) posted studies on comparison of renters and homeowners. I wonder if your lost paper is one of those
Thanks for the links!
I don't see the particular paper I'm thinking of, but the Fed paper does seem to find a similar pattern. The more equity the homeowners have, the less likely they are to move, even when prices were suppressed, which I think suggests tactical concerns about taking a loss on the house are less important than the flexibility have having low or no payments to worry about or access to capital.
OT but in the ballpark:
Maybe Kevin Erdmann should write an op-ed that what L.A. and L.A County (Altadena) should do is completely un-zone the flattened-burned areas, save for designing in some amenities like parks and mass-transit stops.
What L.A. area needs a few forests of high-rise condo complexes....
>> I think part of the anti-mortgage case is the fear that buyers will overbuy because they think the home will appreciate in value.
People also overbuy because they expect future earnings increases to eventually make the mortgage more manageable.