Sonia Gilbukh and Paul Goldsmith-Pinkham

The recent U.S. housing crisis featured explosive growth and collapse of house prices at the national level, with substantial boom-bust pattern variation at the local level. What is less commonly known in the housing market is the behavior of housing quantities. While measures of supply and inventory play an important role in understanding markets, quantity data in housing is traditionally limited to national aggregates. Using a rich new data set of homes listed for sale across a wide range of U.S. housing markets, this post explores whether the collapse in prices from 2006 to 2009 owed more to a flood of houses on the market (higher supply) or a dearth of sales (lower demand).