The Unassuming Economist

On prices, rent, and mortgage:    

• Housing Doesn’t Need Higher Prices—It Needs More Homes – AEI
• A 25-Basis-Point Decline in the Mortgage Rate Prices-In 1.42 Million Households – NAHB
• Case-Shiller: National House Price Index Up 1.3% year-over-year in December. FHFA House Prices up 1.8% YoY in December – Calculated Risk

On sales, permits, starts, and supply:    

• The ripple effects of banning institutional purchases of single-family rentals – Brookings
• Warren urges Trump to press GOP on reining in Wall Street’s housing purchases. “If Trump wanted to make real changes that would lower costs for the American people, we can make that happen,” said the Massachusetts Democrat. – Politico
• Pending Home Sales Slip in January – Realtor.com
• White House Offers New Details on Its Push to Ban Housing Investors. Trump wants to prohibit investors that own more than 100 homes from buying more, potentially banning hundreds of investment firms – Wall Street Journal
• New Home Sales Close 2025 with Modest Gains – NAHB
• New-Home Sales Heat Up To End 2025, but Annual Total Falls Short of 2024 – Realtor.com
• On the Q4 Advance Release: GDP vs. “Core GDP” and Residential Investment – Econbrowser
• 1.600 million Total Housing Completions in 2025 including Manufactured Homes. Altos: Active single-family inventory was up 1.4% week-over-week – Calculated Risk
• High-End Construction Really Does Help Everyone. A new rung at the top of the housing ladder permits people lower down to climb up. – The Atlantic
• AEI State Housing Supply Legislative Update – AEI
• US single-family home price growth slows in December, FHFA says – Reuters
• Housing’s Share of GDP Declined Further at the End of 2025 – NAHB

On other developments:    

• Trump Vows To Make Housing Affordable While Keeping Values Up as He Praises the ‘Golden Age of America’ in State of the Union Speech – Realtor.com
• Trump administration moves to end housing assistance for mixed immigration families – Reuters
• It’s a Buyer’s Market, but Homeownership Eludes Many Americans. A growing split between low-to-middle-income families and wealthy households is changing who has access to homeownership now. – New York Times
• Four Years Into the High-Rate Era: How the Housing Market Changed and Why Prices Didn’t Reset – Realtor.com
• Beyond the State of the Union: Continuing a path to housing affordability – Zillow
• The Housing Market Is Tilting Back Toward Buyers. After years of bidding wars, there are now more sellers than buyers, forcing price cuts — even as high rates continue to narrow the entryway. – New York Times
• Colorado’s Distinct Trends in Affordable Housing Development. Low-Income Housing Tax Credits (LIHTC) are among the most common financing tools for the development of affordable housing units. Over the past 15 years, the development of LIHTC-funded housing units decelerated nationwide but accelerated in Colorado. – Kansas City Fed  

From a paper by Sezer Ferhad:

“The International Monetary Fund is one of the most important international financial institutions, which aims to protect and ensure the development of the global financial system as well as the development of developing countries. The IMF has been the go-to source for help during many times of crisis, and the latest financial and economic crisis following the COVID-19 pandemic was no different. Many countries required aid and policy guidance in order to ensure a fast and strong recovery from the pandemic, and the IMF assumed the role to provide the much-needed support tied to its conditionalities. The aid provided by the IMF had a significant impact on many aspects of economies and led to a considerably quicker recovery, to the surprise of many. The impact of the IMF with regard to rebuilding market trust and financial stability led to a commendable recovery. However, there were several shortcomings as well. The opportunity provided by the need for an economic recovery to reshape economics into a more inclusive, green economic understanding and to reduce inequalities was underutilized, and the characteristic austerity policies of the Fund continued to create new struggles for developing countries with vulnerability. The aim of this paper is to understand the role and impact of the IMF during the post-pandemic economic recovery.”

From a paper by Anja Janischewski, Katharina Bohnenberger, Matthias Kranke, Tobias Vogel, Riwan Driouich, Tobias Froese, Stefanie Gerold, Raphael Kaufmann, Lorenz Keyßer, Jannis Niethammer, and Christopher Olk, Matthias Schmelzer, Aslı Yürük, and Steffen Lange:

“Many socio-economic systems require positive economic growth rates to function properly. These growth dependencies pose serious challenges given uncertainty about future growth rates and the role of economic growth as a driver of environmental crises. Thus, identifying and transforming socio-economic systems that currently rely on growth for their adequate functioning is a crucial step towards effective sustainability transformations. To facilitate conceptual clarity, we propose a general definition and framework for operationalizing the concept of “growth dependence” through four elements: (1) the system under investigation, (2) the unit of growth measurement, (3) the meaning of “growth”, and (4) the functions or properties of the system relevant for human well-being. We illustrate the impact of varieties in definitions on assessment outcomes by applying the framework to areas widely seen as growth-dependent: labor markets, social insurance and public finance. Our framework helps researchers to develop a more coherent understanding of growth dependence, a prerequisite for assessing policy options towards growth independence.”

From a paper by Md Qamruzzaman, Md. Adnan Hoque, and Md. Ratib Khan:

“This study examines the impact of renewable energy consumption, financial globalisation, digitisation, trade freedom, and financial development on income inequality across the G7, E7, and N11 economies from 1990 to 2022. Using CS-ARDL as the baseline estimator to account for cross-sectional dependence and long-run dynamics, the analysis is reinforced with the AMG, CCEMG, and Driscoll–Kraay estimators for robustness, while the dynamic panel GMM addresses potential endogeneity. Nonlinear and distributional heterogeneity were explored using Panel Threshold Regression, Quantile Regression (QR-MM), and Markov Switching models. The results consistently indicate that renewable energy, digitisation, financial globalisation, and trade freedom contribute to reducing income inequality, whereas financial development exacerbates disparities, with the effects being more pronounced in emerging economies (E7 and N11) than in advanced economies (G7). Threshold and quantile analyses reveal that renewable energy and digitisation exert more substantial equalising effects once institutional quality and digital penetration surpass critical levels under conditions of higher inequality. Regime-switching estimations showed a stabilising role during economic stress. These findings suggest that expanding renewable energy and digital infrastructure, and maintaining open trade policies, can help mitigate inequality, particularly in emerging economies, though the benefits of financial development require inclusive frameworks and regulatory safeguards. By integrating multiple advanced econometric techniques, this study provides new evidence on the interconnected roles of globalisation, the energy transition, and digital transformation in shaping income distribution across different economic contexts.”

From a paper by Lisa Capretti, and Lorenzo Tonni:

“The empirical literature on the relationship between income inequality and economic growth has
produced highly heterogeneous and often conflicting results. This paper investigates the sources of this heterogeneity using a meta-analytic approach that systematically combines and analyzes evidence from relevant studies published between 1994 and 2025. We find an economically small but statistically significant negative average effect of income inequality on subsequent economic growth, together with strong evidence of substantial heterogeneity and selective publication based on statistical significance, but no evidence of systematic directional bias. To explain the observed heterogeneity, we estimate a meta-regression. The results indicate that both real-world characteristics and research design choices shape reported effect sizes. In particular, inequality measured net of taxes and transfers is associated with more negative growth effects, and the adverse impact of inequality is weaker – or even reversed – in high-income economies relative to developing countries. Methodological choices also matter: cross-sectional studies tend to report more negative estimates, while fixed-effects, instrumental-variable, and GMM estimators are associated with more positive estimates in panel settings.”