Unit 2, Written Assignment
“Monetary Policy and the Housing Bubble”
What role did the setting of monetary policy play in housing market developments?
The central theme of this paper is to evaluate the role and relationship between monetary policy with a specific focus on the housing market developments. It is an estimation that monetary and/or economic conditions of a country will affect mortgage borrowing as well as prices of homes. The direct correlation between the monetary policy and the housing market is being reviewed with a much more critical eye than pre-housing bubble days.
Previous to the period of the housing bubble it has been acknowledged that the monetary policy attention was not assessed