Lenders are frequently accused of mispricing the put option imbedded in non-recourse lending (Herring and Wachter, 1999 and 2003). Prior research (Pavlov and Wachter, 2004) shows one lender's incentives to underprice. Here we identify the conditions for a market-wide underpricing equilibrium. We...

This paper presents new evidence on the determinants of the large disparities in home ownership by race in the U.S. Consistent with results first reported by P. Linneman and S. M. Wachter (1989, AREOFA J. 7, No. 4, 389-402), we find no ceteris paribus racial differences in ownership rates among...

This chapter contrasts the process of urbanization in China and in India. It characterizes the differences in outcomes with regard to the provision of urban infrastructure and the development of informality in each country. The role of local autonomy and governance structures help to explain...

Fifty years after the adoption of the 1968 Fair Housing Act that prohibits discrimination in the housing market, homeownership rates have not increased for black or Hispanic households. The current homeownership rate for black households is 42 percent, identical to the 1970 census reported...

Nearly one in every two adults aged 18–29 currently lives with their parents, compared to slightly more than one in four in 1960. The literature focuses on changing labor market conditions and marriage-childbearing delays to account for this shift. Using a Blinder-Oaxaca procedure, we identify...

This paper examines mortgage credit markets and the need for government intervention to protect and advance the public interest. We identify as rationales for the public interest: positive and negative externalities, the promotion of equal access, and information asymmetry and principal agent...

We examine the canonical influence of global market, currency and inflation risks on the returns from international real estate securities. In addition, we study how mispricing of credit in the local banking systems is related to the returns from these securities. We analyse a global sample of...

Biographical note: Susan M. Wachter is Richard B. Worley Professor of Financial Management and Professor of Real Estate and Finance at The Wharton School of the University of Pennsylvania and Professor of City and Regional Planning at PennDesign. She codirects the Penn Institute for Urban...