The governor of the Federal Reserve, Michelle Bowman, made a statement collected by Reuters on Monday in which it pointed out “a series of economic and financial stability risks posed by the housing market, particularly pointing out that the Increased demand and slow construction are putting upward pressure on prices”
Bowman also said that we are likely to see higher housing inflation for a while.
“The supply of new homes has been held back by a shortage of materials and labor,” Bowman said in remarks prepared for discussion at the Women in Housing and Finance event. “I foresee that these housing supply problems are unlikely to materially reverse in the short term, which suggests that we are likely to see higher housing inflation for a while. “
Reuters also reported that it said there are risks, especially posed by non-bank mortgage companies, whose loans could pose some risks to the broader financial system because they are unable to take advantage of government protection backs. Better data collection and greater supervision of those companies “is appropriate,” Bowman said, adding that he is concerned that bank and non-bank mortgage lenders are subject to different levels of supervision.
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