This paper studies how mortgage borrowers and house prices react to a tightening of mortgage limits following a policy … leverage (LTV) of the mortgage. Using a difference-in-difference methodology, I find that groups of (poorer) borrowers, who …-to-value threshold, responded primarily by reducing the LTV of the mortgage. Borrowers who purchase cheaper houses could be buying …

Panel Probit model over the period 1980-2007. It finds that 1) most recent housing booms have been very persistent and of a … term interest rates, local and global money and credit developments, and the incidence of mortgage market deregulation …