TY - JOUR
T1 - Local economic risk factors and the primary and secondary mortgage markets
AU - Ambrose, Brent W.
AU - Pennington-Cross, Anthony
N1 - Funding Information:
We thank Don Bradley, Michael Marschoun, Frank Nothaft, John Quigley, William Reeder, William Segel, the seminar participants at the US Department of Housing and Urban Development, Freddie Mac, the University of Cincinnati, and the University of Kentucky, and the two anonymous reviewers for their helpful comments and suggestions. Financial support for this project was provided by the US Department of Housing and Urban Development Office of Policy Development and Research under grant H-21122RG. The views and opinions expressed herein are entirely those of the authors and do not represent those of the US Department of Housing and Urban Development.
PY - 2000
Y1 - 2000
N2 - This paper presents a cross-sectional analysis of the spatial distribution of loans in the primary and secondary mortgage markets. Aggregating loan originations to the MSA level, we examine the proportion of the market served by FHA and conventional lenders. We model the geographic differences in market shares as a function of supply, demand, and economic risk factors. Results indicate that FHA market shares are higher in cities with higher economic risk characteristics. To examine the role of GSE activity, we model the spatial distribution of the disposition of conventional loans. Again, we focus on the impact of local economic risk factors on the proportion of loans purchased by the GSEs, purchased by other financial institutions, or retained by the originating lender. Our results indicate that GSEs purchase rates are fairly insensitive to local economic conditions indicating that they serve the primary market with little spatial variation.
AB - This paper presents a cross-sectional analysis of the spatial distribution of loans in the primary and secondary mortgage markets. Aggregating loan originations to the MSA level, we examine the proportion of the market served by FHA and conventional lenders. We model the geographic differences in market shares as a function of supply, demand, and economic risk factors. Results indicate that FHA market shares are higher in cities with higher economic risk characteristics. To examine the role of GSE activity, we model the spatial distribution of the disposition of conventional loans. Again, we focus on the impact of local economic risk factors on the proportion of loans purchased by the GSEs, purchased by other financial institutions, or retained by the originating lender. Our results indicate that GSEs purchase rates are fairly insensitive to local economic conditions indicating that they serve the primary market with little spatial variation.
UR - https://www.scopus.com/pages/publications/0034535025
UR - https://www.scopus.com/pages/publications/0034535025#tab=citedBy
U2 - 10.1016/S0166-0462(00)00050-8
DO - 10.1016/S0166-0462(00)00050-8
M3 - Article
AN - SCOPUS:0034535025
SN - 0166-0462
VL - 30
SP - 683
EP - 701
JO - Regional Science and Urban Economics
JF - Regional Science and Urban Economics
IS - 6
ER -