Abstract

http://ssrn.com/abstract=1722195
 
 

References (32)



 
 

Citations (18)



 


 



Foreclosures, House Prices, and the Real Economy


Atif R. Mian


Princeton University - Department of Economics; Princeton University - Woodrow Wilson School of Public and International Affairs; NBER

Amir Sufi


University of Chicago - Booth School of Business; NBER

Francesco Trebbi


University of British Columbia (UBC) - Department of Economics; National Bureau of Economic Research (NBER)

January 31, 2014

Fama-Miller Working Paper
Chicago Booth Research Paper No. 13-41

Abstract:     
From 2007 to 2009, states without a judicial requirement for foreclosures were more than twice as likely to foreclose on delinquent homeowners. Comparing zip codes close to state borders with differing foreclosure laws, we show that foreclosure propensity and housing inventory jumped discretely as one entered non-judicial states. There is no jump in other homeowner attributes such as credit scores, income, or education levels. Using state judicial requirement as an instrument for foreclosures, we show that foreclosures led to a large decline in house prices, residential investment, and consumer demand from 2007 to 2009. As foreclosures subsided from 2011 to 2013, the difference between foreclosure rates in non-judicial and judicial requirement states shrank and we find evidence of a stronger recovery in non-judicial states.

Number of Pages in PDF File: 59

Keywords: Foreclosures, House Prices, Durable Consumption, Residential Investment, Auto Sales, Mortgage Defaults, Amplification

working papers series


Download This Paper

Date posted: December 9, 2010 ; Last revised: February 1, 2014

Suggested Citation

Mian, Atif R. and Sufi, Amir and Trebbi, Francesco, Foreclosures, House Prices, and the Real Economy (January 31, 2014). Fama-Miller Working Paper; Chicago Booth Research Paper No. 13-41. Available at SSRN: http://ssrn.com/abstract=1722195 or http://dx.doi.org/10.2139/ssrn.1722195

Contact Information

Atif R. Mian
Princeton University - Department of Economics ( email )
Princeton, NJ 08544-1021
United States
Princeton University - Woodrow Wilson School of Public and International Affairs ( email )
Princeton University
Princeton, NJ 08544-1021
United States
NBER
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Amir Sufi (Contact Author)
University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
NBER
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Francesco Trebbi
University of British Columbia (UBC) - Department of Economics ( email )
997-1873 East Mall
Vancouver, BC V6T 1Z1
Canada
HOME PAGE: http://faculty.arts.ubc.ca/ftrebbi/
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Feedback to SSRN


Paper statistics
Abstract Views: 8,642
Downloads: 1,741
Download Rank: 4,289
References:  32
Citations:  18

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo6 in 0.329 seconds