Why are housing prices so high, mortgage rates out of sight, construction costs off the roof, and homeownership in urban areas unaffordable for all but the very rich? Adam Guren is my brilliant colleague at Boston University, whose economics department, if I may brag for a moment, is one of the best in the world. Adam is one of the country's top young macro economists. But his forte is housing and mortgage markets. Want to know if you'll ever be able to buy a home or move, Adam has answers. Take a listen and please share.
PS, Anyone can receive a lifetime free subscription to my podcast by emailing me at kotlikoff@gmail.com. Send me all your contact emails if you want. The more the better!
Topics Covered:
Housing Market Dynamics
Construction Cost Crisis
Financial Crisis Retrospective and Future Policies
Affordable Housing Strategies
The value of this discussion lies in its ability to dissect and clarify the complex engine that drives housing markets, while also offering grounded, forward-looking perspectives that house hunters, investors, and policymakers will find indispensable.
Time Stamps:
00:00 Discussion on housing and mortgages in economics.
05:03 Unusual housing market driven by low inventory.
08:15 Housing construction challenges persist despite labor shortage.
11:10 Housing cycle shifts, prices decrease in Iowa.
13:04 Builder prefers rentals over condos, avoids conflict.
17:00 Studying building approvals and property tax abatement.
21:29 Increased supply needed, gradual process ahead. Zoning reform.
25:38 High office building vacancies may trigger financial crisis.
28:18 Sacrifice space for better job opportunities, investment.
33:17 Rising mortgage rates make current period painful.
34:21 Prepayments on mortgage-backed securities fell unexpectedly.
39:57 Financial Crisis Inquiry Commission report reveals causes.
42:12 Credit expansion broad, not just subprime growth.
47:13 Discussion of multiple equilibria in financial crisis.
50:10 Stock market vs real estate wealth impact.
53:31 Research improves understanding of mortgage modification.
This conversation offers valuable insights as the discussion navigates through the intricacies of today's housing challenges
Economic Matters - The podcast is hosted by Laurence Kotlikoff and moderated by Alex Kotlikoff.
Laurence Kotlikoff is a Boston University Economist, a NY Times Best Selling Author, President of maxifi.com, and Author of Money Magic.
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Why Today's Housing Market Is Crazy