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Why House Prices Surged as the COVID-19 Pandemic Took Hold
In the wake of the short but steep COVID-19 recession, house prices have risen at record levels in recent months, hitting the peak increase of 19.3 percent in July 2021.
Texas among states feeling most stressed by inflation
As consumer prices have climbed at a faster rate in Texas and surrounding states than nationally—food and shelter increasing even more—Texans are feeling especially stressed about rising prices.
Journal Article
High school financial literacy mandate could boost Texans' economic well-being
National surveys suggest Texans have a relatively low level of financial literacy that can adversely affect decision-making. Since state lawmakers mandated high school financial coursework in 2007, consumer credit measures of young Texas adults have improved.
Working Paper
Mobility and Engagement Following the SARS-Cov-2 Outbreak
We develop a Mobility and Engagement Index (MEI) based on a range of mobility metrics from Safegraph geolocation data, and validate the index with mobility data from Google and Unacast. We construct MEIs at the county, MSA, state and nationwide level, and link these measures to indicators of economic activity. According to our measures, the bulk of sheltering-in-place and social disengagement occurred during the week of March 15 and simultaneously across the U.S. At the national peak of the decline in mobility in early April, localities that engaged in a 10% larger decrease in mobility than ...
Journal Article
Plunging oil prices: a boost for the U.S. economy, a jolt for Texas
Economic activity in the U.S. overall will benefit from the oil price collapse. The decline will, however, negatively affect oil-producing states such as Texas and North Dakota.
Working Paper
Understanding the Exposure at Default Risk of Commercial Real Estate Construction and Land Development Loans
We study and model the determinants of exposure at default (EAD) for large U.S. construction and land development loans from 2010 to 2017. EAD is an important component of credit risk, and commercial real estate (CRE) construction loans are more risky than income producing loans. This is the first study modeling the EAD of construction loans. The underlying EAD data come from a large, confidential supervisory dataset used in the U.S. Federal Reserve’s annual Comprehensive Capital Assessment Review (CCAR) stress tests. EAD reflects the relative bargaining ability and information sets of ...
How Did Federal Stimulus Recipients Use Their Checks?
Did stimulus payments go to—and were they used by—those who needed them the most? The evidence suggests that this was the case.
Working Paper
House prices and credit constraints: making sense of the U.S. experience
Most U.S. house price models break down in the mid-2000s due to the omission of exogenous changes in mortgage credit supply (associated with the subprime mortgage boom) from house price-to-rent ratio and inverted housing demand models. Previous models lack data on credit constraints facing first-time homebuyers. Incorporating a measure of credit conditions?the cyclically adjusted loan-to-value ratio for first-time buyers?into house price-to-rent ratio models yields stable long-run relationships, more precisely estimated effects, reasonable speeds of adjustment and improved model fits.
Working Paper
The impact of hurricanes on housing prices: evidence from U.S. coastal cities
We investigate the effect of hurricane strikes on housing prices in U.S. coastal cities. To this end, we construct a new index of hurricane destruction which varies over time and space. Using this index and an annual, two equation, dynamic equilibrium correction panel model with area and time fixed effects, we model the effects of hurricanes on real house process and real incomes. In our model hurricanes have a direct effect on house prices and an indirect effect via a fall in local incomes. Our results show that the typical hurricane strike raises real house prices for a number of years, ...
Journal Article
Increased credit availability, rising asset prices help boost consumer spending
A combination of much less household debt, revived access to consumer credit and recovering asset prices have holstered U.S. consumer spending. This trend will likely continue despite an estimated 50 percent reduction since the mid-2000s of the housing wealth effect?an important amplifier during the boom years.