Housing price disparities complicate US monetary policy – research

Time-varying inertia in prices makes housing bubbles more unpredictable, Dallas Fed paper says

Small toy houses

US monetary policy will have varying effects by region due to disparities in housing price inertia, research published by the Federal Reserve Bank of Dallas finds.

The expansion of the credit supply has created greater persistence in housing price growth, Chi-Young Choi, Alexander Chudik, and Aaron Smallwood write in their paper. “More persistent house-price growth suggests more enduring effects of housing markets on the economy,” the authors say.

“Growth in house prices is highly persistent and

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