Working Paper: Securitization and House Price Growth

Working Paper - June 2021 - No. 181

Authors Nelson, Genevieve (Danmarks Nationalbank)
Subject Housing finance; Financial sector; USA
Type Working paper
Year 2021
Published 28 June 2021
Abstract icon From 2000-2006 US house prices and mortgage credit grew while the relative cost of mortgage credit fell particularly for privately securitized mortgages suggesting a credit supply expansion. This paper explores two (credit supply) shocks: an increased inflow of global savings into the US, and innovations in the securitization of mortgage credit. Only innovation in securitization matches mortgage market dynamics.