Lending to the Poor and Minorities Leading to the Housing Crisis: Was There a Boom?

42 Pages Posted: 20 Jun 2019 Last revised: 17 Mar 2020

See all articles by Alejandro Rojas

Alejandro Rojas

Middle Tennessee State University - Department of Economics and Finance

Date Written: December 17, 2019

Abstract

I provide new evidence on the boom and bust in the housing market during the mid-2000s. The boom actually began in the late 1990s, paused briefly in 2001, and then resumed through the mid-2000s. Moreover, the boom was indeed greatly pronounced among lower-income and higher-minority neighborhoods, indicating that mortgage lending expanded for reasons that were unrelated to factors such as an improvement in borrower income prospects or credit quality. These results are consistent with the credit supply view that the boom and bust was caused by an exogenous expansion in the supply of mortgage credit.

Keywords: housing, mortgage, credit, crisis, boom, bust

JEL Classification: G21, G28, R31, R38

Suggested Citation

Rojas, Alejandro, Lending to the Poor and Minorities Leading to the Housing Crisis: Was There a Boom? (December 17, 2019). Available at SSRN: https://ssrn.com/abstract=3404326 or http://dx.doi.org/10.2139/ssrn.3404326

Alejandro Rojas (Contact Author)

Middle Tennessee State University - Department of Economics and Finance ( email )

Murfreesboro, TN 37132
United States

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