The Laser Scalpel to Target the Housing Market

Countercyclical macroprudential mortgage regulation is possible.

It’s been a wild ride for U.S. homebuilders, homebuyers, and mortgage originators in the past 16 months.

Surging demand has pushed up house prices at the fastest rate on record and lifted the rate of new construction starts to the highest level since the bubble years. Homeowners have been furiously monetizing their equity, extracting more than $260 billi…