The Unassuming Economist

On prices, rent, and mortgage:    

• April Mortgage Rates Edge Up Following Treasury Sell-Off – NAHB
• Washington State Lawmakers Vote to Limit Rent Increases. Supporters say an annual cap of 10 percent, including inflation, will protect tenants. Critics worry it will reduce housing supply and discourage investors. – New York Times
• Case-Shiller: National House Price Index Up 3.9% year-over-year in February. FHFA House Prices up 3.9% YoY – Calculated Risk
• Case Shiller Home Price Index Climbs 3.9% in February – Realtor.com
• Freddie Mac House Price Index Mostly Unchanged in March; Up 3.0% Year-over-year. 10 of the 19 cities with largest price declines are in Florida! – Calculated Risk
• Home Price Momentum Slows—and Prices Are Falling in One Florida City – Realtor.com
• US Home-Price Gains Eased in February as Listings Increased – Bloomberg
• AEI Housing Market Indicators, April 2025 – AEI

On sales, permits, starts, and supply:    

• March Home Sales Were the Slowest Since 2009. Some Predict Prices Could Drop Next. – Barron’s
• Final Look at Local Housing Markets in March and a Look Ahead to April Sales – Calculated Risk
• Sales of Existing Homes Plunge to Their Slowest March Pace Since 2009, in Warning Sign for Spring Housing Season – Realtor.com
• Housing market inventory with a price cut just hit a decade high. In total, 302,260 U.S. homes for sale on Realtor.com in March 2025 had a price cut. That represents 33.9% of the active U.S. housing inventory. – Realtor.com
• Back to Basics. Plus: California zoning bill survives powerful lawmaker’s economic illiteracy, Montana legislators pass simple, sweeping, supply-side housing reforms, and Washington passes rent control. – Reason
• Home Builders Are Piling on Discounts as They Struggle to Entice Buyers. Demand during the spring home-buying season has been disappointing, and tariffs threaten to raise costs – Wall Street Journal
• Milwaukee Is One of America’s Most Cutthroat Rental Markets. In this Midwestern city, a lack of housing supply has baby boomers, millennials and Gen Z all vying for apartments. – Wall Street Journal

On other developments:    

• The sluggish housing market isn’t entirely bad news – Axios
• Real Estate Brokerages Fight Over How Houses for Sale Should Be Listed. Compass, one of the largest brokerages in the country, has sued a real estate database in Seattle and accused it of “monopolistic” and “anticompetitive” behavior. – New York Times
• Battle of Home Buyers vs. Investors Is Making Toledo a Housing ‘Gold Mine’. Ohio city of 265,000 is one of the increasingly rare affordable housing markets in the U.S. – Wall Street Journal
• The Spring 2025 Wall Street Journal/Realtor.com Housing Market Ranking – Realtor.com 
• Can the Housing Market Withstand a Shrinking Workforce? The Role of Hispanic Labor Under Pressure – Realtor.com 
• In the competitive D.C. housing market, government layoffs bring a growing sense of unease. The nation’s capital is still a seller’s market, but buyers are slowly gaining power. – Yahoo Finance
• 4 of America’s Hottest Markets Boast Low Cost of Living, Low Home Prices, and Climate Resiliency – Realtor.com
• Homeownership Rate Dips to Five-Year Low – NAHB
• Buyer’s or seller’s housing market? Zillow’s analysis for 250 markets. Here’s where home sellers—and homebuyers—have the most power right now, according to Zillow’s most recent analysis. – Fast Company
• Housing on Federal Lands Aims to Ease Affordability Crisis. Housing developers and researchers say the idea of building more homes on federal land could help ease shortages. But various obstacles could hinder the effort. – New York Times
• Roofs, repairs, and rodents: How housing quality has climbed in the Twin Cities. Alongside paying higher housing costs, Twin Cities area households have bigger, better places to call home than they did in in 1997 – Minneapolis Fed
• Trump’s First 100 Days in Office Deliver Little Progress on Solving the Housing Crisis – Realtor.com
• The Housing Market Has New Rules. Realtors Are Evading Them. A landmark settlement was expected to disrupt how real-estate agents are paid. This is how that didn’t happen. – New York Times
• When Did the American Housing Affordability Crisis Begin? – National Review  
• The Best Time to Sell a Home is in May – ATTOM
• Homeownership Falls to Its Lowest Level in 5 Years—and One Age Group Is Hit the Hardest – Realtor.com
• A YIMBY Theory of Power. Pro-housing advocates offer an analysis of class relations that is more sophisticated and has more explanatory power than the one held by many critics of the “abundance agenda.” – The Nation
• Housing’s Share of the Economy Grows Higher to Start the Year – NAHB
• Long-Term Impacts of Residential Racial Desegregation Programs – NBER 
• Trump Doesn’t Need the Fed To Fix Housing. Former Rep. Ron Paul argues that slashing red tape will do more to bring down home prices than pressuring the central bank to cut interest rates. – Reason
• Texas City Makes Bold Move To Fix the Housing Crisis – Realtor.com

From a paper by Jingye Liu, Fengqi Guo, Ying Shi, Rijia Ding, and Zhen Chen:

“The recurrence of international geopolitical events has intensified tensions in global energy supply chains. As a major crude oil consumer, China urgently needs to identify vulnerabilities within its crude oil supply chain (COSC) and implement targeted measures to safeguard national energy security. In this study, a risk evaluation index system was constructed based on the entire life cycle in COSC. Then, the phased and overall prominent risks in the China’s COSC from 2012 to 2022 were identified through a two-phase DEA-like model. Furthermore, the evolution of the comprehensive security level of COSC was assessed throughout the study period. Specifically, the phased risks of China’s COSC mainly focused on strategic petroleum reserves (SPR) in the midstream application stage and refined oil trade in the downstream consumption stage. Additionally, China’s COSC primarily confronted overall risks involving domestic crude oil supply potential, geopolitical imports, maritime transportation, and domestic oil consumption. Although the security level of China’s COSC showed an upward trend from 2012 to 2022, the security of the upstream still lagged behind that of the midstream and downstream. Hence, policy recommendations to enhance China’s COSC security include advancing the exploration and development of unconventional oil, strengthening international energy cooperation and the autonomy of maritime transportation, expanding the SPR, increasing the proportion of renewable energy, and establishing a risk early warning platform.”

From a paper by Daniel Halvarsson, and Martin Korpi:

“This study investigates the relationship between the urban wage premium and employer concentration using Swedish full population employer-employee data. Departing from an AKM modeling framework to distinguish worker from firm specific heterogeneity – a measure of rent-sharing – we then measure the urban wage premium using differences in the estimated firm fixed effects at the level of local industries, nested within local labor markets. Our results suggest that labor market employer concentration, as calculated using the Hirschman-Herfindahl index and a leave-one-out instrumental variable design, can account for a significant share of the estimated urban wage premium (UWP). Addressing city-level wage income inequality by applying our model to different segments of the local labor market income distribution, we find that while the UWP pertains to all income segments, it is largest for top-income levels (above the 90th percentile), and within this segment employer concentration also has the largest explanatory power. Thus, while being an important explanatory factor for all percentiles of the local income distribution, a relatively lower employer concentration within larger cities, and vice versa, higher concentration within smaller cities, primarily help explain the variance of top wages within these cities/labor markets.”

From a paper by by Luis I. Jácome, Nicolás E. Magud, Samuel Pienknagura, Martin Uribe:

“As inflation targeting (IT) turns 35, it has become a key institutional monetary framework by central banks. Yet, this paper shows that stark differences exist among inflation targeting countries in the conduct of monetary policy. Behind such heterogeneity, the legacy of a high inflation history appears as a preponderant factor. We propose a model that diverges from existing IT workhorse models by adding path-dependence (to a forward-looking model) and potentially imperfect central bank credibility. We show that achieving low inflation (hitting the target) requires more aggressive monetary policy, and is costlier from an output point of view, when individuals’ past inflationary experiences shape their inflation expectation formation. In turn, we provide empirical evidence of the need for these two theoretical additions. Countries that experienced a high level of inflation before adopting the IT regime tend to respond more aggressively to deviations of inflation expectations from the central bank’s target. We also point to the existence of a credibility puzzle, whereby the strength of a central bank’s monetary policy response to deviations from the inflation target remains broadly unchanged even as central banks gain credibility over time. Put differently, a country’s inflationary past casts a long and persistent shadow on central banks.”

From a paper by Antonis Tsitouras & Harry Papapanagos:

“Few studies have explored the impact of foreign direct investment (FDI), trade openness, economic growth, education, and inflation influence income inequality in developed economies. This study examines these factors in Greece using the autoregressive distributed lag (ARDL) method. The novelty of this research lies in its application of three distinct measures of income inequality: (a) the Gini index, (b) the income share of the poorest 20% quantile, and (c) the income share of the top 20% quantile. The results have significant theoretical and policy implications. First, GDP per capita elasticities strongly support Kuznets’ theory. Second, while FDI does not significantly affect on income distribution in the short term, it predominantly improves income distribution at the upper and median levels in the long term while reducing the income share of the lowest 20% quantile. Third, trade openness initially increases income inequality but primarily improves distribution at the lower and median levels over time. Fourth, although education initially exacerbates economic inequality, it significantly supports lower and median income levels in the long run. Finally, inflation negatively impacts income equality in both the medium and long term, boosting the earnings of the top 20% quantile over time. These findings suggest that governments should address income inequality by focusing on sustainable growth, improving education, implementing reforms to attract FDI, boosting exports, and adopting measures to control inflation.”