Discussions of whether a housing bubble exists generally rely on indirect barometers such as rapidly increasing prices … evidence of a bubble in most of these cities: under a variety of plausible assumptions, buying a home in these cities today …

This paper looks for evidence of a bubble in U.S. housing prices. It analyzes quarterly state-level data over 1985 … economically implausible beliefs about home price behavior—findings consistent with a bubble. Prices in such markets could stall or …