Would a Housing Crash Cause a Recession? (CRS Report for Congress)
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| Release Date |
Nov. 7, 2007 |
| Report Number |
RL34244 |
| Report Type |
Report |
| Authors |
Marc Labonte, Government and Finance Division |
| Source Agency |
Congressional Research Service |
Summary:
After several years of unprecedented price appreciation, the housing boom hascome to an end, and some economists believe that prices in many markets willexperience a near-term decline. The housing boom has gripped the public'simagination in the current economic expansion, and many observers now wonder ifa housing crash would cause an economic recession (a sustained period of sub-pareconomic growth and higher unemployment). This report will examine the channelsthrough which changes in the housing market affect the economy, and what policyoptions might be used to offset its adverse effects. It will begin with a briefdiscussion of the housing boom and its aftermath.
