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Working Paper
Volatility in Home Sales and Prices: Supply or Demand?
We use a housing search model and data on individual home listings to decompose fluctuations in home sales and price growth into supply or demand factors. Simulations of the estimated model show that housing demand drives short-run fluctuations in home sales and prices, while variation in supply plays only a limited role. We consider two implications of these results. First, we show that reduction of supply was a minor factor relative to increased demand in the tightening of housing markets during COVID-19. New for-sale listings would have had to expand 30 percent to keep the rate of price ...
Journal Article
Big Federal Stimulus, Home-Value Spike Won’t Ease Next Slump
Historically large federal transfers coupled with rapid home-price appreciation bolstered state and local revenue in Texas, softening the economic impact of COVID-19 on vulnerable populations. Ultra-low interest rates and a historic housing boom that aided state and local government operations are fading, suggesting Texas policymakers may encounter additional difficulties during the next downturn.