Energy Prices, the Financial Crisis, and Their Implications for Land Policies in California
Junjie Wu, Steven Sexton, Joel Ferguson, and David Zilberman
The more than doubling of fuel prices between 2001 and 2006, combined with lax lending practices, triggered the collapse of the housing market that ultimately led to the Great Recession of 2008. In California, commuter communities with relatively lower income and located greater distances from the coastal urban centers suffered the largest declines in housing value and highest rates of foreclosure. Our analysis suggests that relaxing land use regulation to improve housing opportunities in urban centers will increase the resilience of the housing market, while policies that raise energy costs will increase its vulnerability (at least in the short run).
Mortgages, bankruptcies, urban sprawl, underwater, transportation
Junjie Wu, Steven Sexton, Joel Ferguson, and David Zilberman. 2019. "Energy Prices, the Financial Crisis, and Their Implications for Land Policies in California." ARE Update 22(6): 1-4. University of California Giannini Foundation of Agricultural Economics.