Housing bubbles burst, creating economic misery for millions. Over the past thirty years, the culture of property ownership has become so ingrained that policy makers, bankers and households have taken for granted that housing is a good investment and forgotten about the bust. Explaining how the current crisis in housing markets has arisen, this topical and sharp analysis considers the causes of house price bubbles and the reason for the collapse in markets worldwide. Written for students, it explains the economic cycle of housing, ways in which future booms and busts can be mitigated and how the lessons of this latest housing bubble can finally be learned.
1. Housing is Not Finance 2. Really Private Finance 3. Lots of Bad Decisions 4. A Political Problem 5. On the Virtue of Benign Neglect 6. Conclusions: A Plea for Sanity