- Regional Redistribution Through the U.S. Mortgage Market, by Erik Hurst, Benjamin J. Keys, Amit Seru and Joseph Vavra, NBER Working Paper No. w21007.
- Will the Bubble Burst Be Revisited, by P.D. Aditya, March 8, 2015.
- Data & Civil Rights: Housing Primer, by Alex Rosenblat, Kate Wikelius, Danah Boyd, Seeta Peña Gangadharan, & Corrine Yu, Data & Civil Rights Conference, Oct. 2014.
- What Have They Been Thinking? Homebuyer Behavior in Hot and Cold Markets – A 2014 Update, by Karl E. Case, Robert J. Shiller, & Anne K. Thompson, Cowles Foundation Discussion Paper No. 1876R.
- Supply Restrictions, Subprime Lending and Regional US House Prices, André K. Anundsen & Christian Heebøll, CESifo Working Paper Series No. 5236.
- A Quantitative Analysis of the U.S. Housing and Mortgage Markets and the Foreclosure Crisis, by Satyajit Chatterjee & Burcu Eyigungor, FRV of Philadelphia Working Paper No. 15-13.
- Alcohol- and Drug-Free Housing: A Key Strategy in Breaking the Cycle of Addiction and Recidivism, by Susan F. Mandiberg & Richard Harris, McGeorge Law Review, Forthcoming.
- The International Problem of Skyrocketing Rent: Why Increased Rent Can Hurt the Economy, Fatima Al Matar, March 17, 2015.
Tag Archives: housing bubble
Wednesday’s Academic Roundup
- Banking Integration and House Price Comovement, by Augustin Landier, David Alexandre Sraer & David Thesmar, CEPR Discussion Paper No. DP10295.
- Second-Liens and the Leverage Option, by Adam J. Levitin & Susan M. Wachter, U of Penn. Inst. for Law & Econ Research Paper.
- Regulating Against Bubbles: How Mortgage Regulation Can Keep Main Street and Wall Street Safe – From Themselves, by Ryan Bubb & Prasad Krishnamurthy, University of Pennsylvania Law Review, Vol. 163, Forthcoming NYU Law and Economics Research Paper No. 15-03.
- Who Wins Residential Property Tax Appeals?, by Randall K. Johnson, Columbia Journal of Tax Law, Forthcoming Mississippi College School of Law Research Paper No. 2015-01.
- The Theft of Affordable Housing: How Rent Stabilized Apartments are Disappearing from Fraudulent Individual Apartment Improvements and What Can Be Done to Save Them, by Justin R. La Mort, New York University Review of Law & Social Change, Forthcoming.
Reiss on Castro at HUD
Law360 quoted me in Obama Chooses San Antonio Mayor As Next HUD Chief (behind a paywall). It reads in part,
President Barack Obama on Friday nominated San Antonio Mayor Julian Castro to be the next secretary of housing and urban development, a move that observers say will result in the continuation of his administration’s housing policies.
If confirmed, Castro would take over an agency that is still dealing with the after-effects of the bursting of the housing bubble in 2007 and the resulting foreclosure crisis. HUD is also struggling to deal with a dearth of affordable housing in major metropolitan areas and reforming the Federal Housing Administration’s work.
Obama called Castro an “all-star” who has done a “fantastic job” in San Antonio over the last five years.
“He’s become a leader in housing and economic development,” the president said.
Speaking at the White House on Friday, Castro said that he looked forward to helping Americans get access to “good, safe affordable housing.”
“We are in a century of cities. America’s cities are growing again and housing is at the top of the agenda,” Castro said.
Castro would take over HUD from outgoing Secretary Shaun Donovan, whom Obama nominated to lead the Office of Management and Budget. Donovan would in turn replace Sylvia Mathews Burwell, Obama’s nominee to be the next secretary of health and human services.
Among his major tasks will be overseeing the FHA, which provides a government guarantee on mortgages issued to low-income and first-time homebuyers. The agency, which is led by Commissioner Carol Galante, last year was forced to take a $1.7 billion bailout from the Treasury Department as its reserves were depleted due to losses on bad loans.
In response, the FHA has increased insurance premiums on most new mortgages by 10 basis points and sold off some defaulting mortgages as part of a series of reforms aimed at bolstering its capital levels. Even with those changes, the bailout was necessary.
HUD has also been a key player in the Obama administration’s heavily criticized programs aimed at stemming foreclosures, including the Home Affordable Mortgage Program, and in efforts to develop affordable housing stock around the country.
The department is also at the center of fair lending and fair housing litigation against banks and other lenders.
Castro’s views on those subjects are unknown, but observers expect him to follow closely policies established by his predecessor Donovan.
“Our conversations lead us to believe that Castro is unlikely to deviate materially from the existing FHA single-family strategy,” Isaac Boltansky, an analyst at Compass Point Research & Trading LLC, said in a note to clients.
Castro, 39, is serving his third term as San Antonio’s mayor. A rising star in the Democratic party, Obama tapped Castro to give the keynote address at the 2012 Democratic National Convention in Charlotte, North Carolina.
In many ways the appointment is seen as a political decision as much as a policy one for housing experts, and a departure from Donovan, an expert on housing policy.
“Donovan focused his entire career on housing and affordable housing in particular. He is known for his deep understanding of housing issues. Mayor Castro has had a broader portfolio of concerns as a big city mayor,” said Brooklyn Law School professor David Reiss.
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While Castro has focused on affordable housing issues, the mayor of San Antonio is a nonexecutive position, Reiss noted.
“So his ability to implement his vision will be tested in this new position,” he said.
Reiss on Snuffing out FIRREA
Law360 quoting me in BofA Fight Won’t Blunt DOJ’s Favorite Bank Fraud Weapon (behind a paywall). It reads in part,
A federal magistrate judge on Thursday put a Justice Department case against Bank of America Corp. using a fraud statute from the 1980s in peril, but the case’s limited scope means the government is not likely to abandon its favorite financial fraud fighting tool, attorneys say.
Federal prosecutors have increasingly leaned on the Financial Institutions Reform, Recovery and Enforcement Act, a relic of the 1980s savings and loan crisis, as a vehicle for taking on banks and other financial institutions over alleged violations perpetrated during the housing bubble years.
* * *
Some banking analysts hailed the ruling as potentially the beginning of the end of the government’s pursuit of housing bubble-era violations.
“If the judge’s recommendation is accepted by the federal district court judge, then this development will represent a significant setback for the government’s legal efforts and likely mark the beginning of the end for crisis-era litigation,” Isaac Boltansky, a policy analyst at Compass Point Research & Trading LLC, said in a client note.
However, others say the government’s case was brought under relatively narrow claims that Bank of America did not properly value the securities to induce regulated banks to purchase securities they otherwise might not have.
That is a tougher case to bring than the broad wire fraud and mail fraud claims that were available to the government under FIRREA. The government has employed those tools with great success against Bank of America and Standard & Poor’s Financial Services LLC in other cases in far-flung jurisdictions, said Peter Vinella, a director at Berkeley Research Group.
“There was no issue about whether BofA did anything wrong or not. It’s just that the case was filed incorrectly. It was very narrowly defined,” he said.
It is not entirely clear that Bank of America is in the clear in this case, either.
U.S. district judges tend to give great deference to reports from magistrate judges, according to David Reiss, a professor at Brooklyn Law School.
But even if U.S. District Judge Max O. Cogburn Jr. accepts the recommendation, the Justice Department has already lodged a notice of appeal related to the report. And in the worst-case scenario, the government could amend its complaint.
A victory for Bank of America in the North Carolina case is unlikely to have a widespread impact, given the claims that are at stake. The government will still be able to bring its broader, and more powerful claims, under a law with a 10-year statute of limitations.
“It is one opinion that is going against a number of FIRREA precedents that have been decided in others parts of the country,” Reiss said. “It also appears that this case was brought and decided on much narrower grounds than those other cases, so I don’t think that it will halt the government’s use of the law.”
