Host Tom Schopflocher discusses the economic factors supporting the U.S. housing market and what could happen to the record high pace of home price appreciation should they change course. Based on these factors, we carried out a statistical study to determine the likelihood of a sudden correction in home prices. We also ran a scenario analysis to understand how a sharp drop in home prices might impact ratings of certain U.S. non-agency RMBS.
Related Article: A Sudden Correction To Fast-Rising U.S. Home Prices Isn't Likely