Delve into an in-depth analysis exploring recent fluctuations in U.S. home prices and mortgage interest rates authored by W. Scott Frame, Chief Economist & Head of Policy at Structured Finance Association, and Kristopher Gerardi, Senior Policy Adviser at the Federal Reserve Bank of Atlanta. This essay discusses how pandemic-induced changes in housing preferences, accommodative monetary policy, and generous income support led to rapid home price appreciation. It then documents how tighter monetary policy slowed home price growth but notes that prices have remained remarkably resilient owing to continued income growth and reduced supply of homes on the market associated with the higher interest rate environment.
