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  • Cited by 5
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    This article has been cited by the following publications. This list is generated based on data provided by CrossRef.

    Brennan, John F. 2015. The impact of Depression-era Homeowners’ Loan Corporation lending in Greater Cleveland, Ohio. Urban Geography, Vol. 36, Issue. 1, p. 1.

    2014. Introduction to Mortgages & Mortgage Backed Securities.

    Bénétrix, Agustín S. Eichengreen, Barry and O'Rourke, Kevin H. 2012. How housing slumps end. Economic Policy, Vol. 27, Issue. 72, p. 647.

    IMF. Research Dept., 2012. World Economic Outlook, April 2012: Growth Resuming, Dangers Remain.

    ROSE, JONATHAN D. 2011. The Incredible HOLC? Mortgage Relief during the Great Depression. Journal of Money, Credit and Banking, Vol. 43, Issue. 6, p. 1073.


Repairing a Mortgage Crisis: HOLC Lending and Its Impact on Local Housing Markets

  • Charles Courtemanche (a1) and Kenneth Snowden (a1)
  • DOI:
  • Published online: 06 June 2011

Between 1933 and 1936 the Home Owners’ Loan Corporation purchased more than a million delinquent mortgages from private lenders and refinanced those loans for the borrowers. Its primary goal was to break the cycle of foreclosure, forced property sales and decreases in home values that was affecting local housing markets throughout the nation. We find that the volume of HOLC lending was related to measures of distress in local (county-level) housing markets and that these interventions increased 1940 median home values and homeownership rates, but not new home building.

“[A] tremendous surge of residential building in the [last] decade… was matched by an ever-increasing supply of homes sold on easy terms [and only]… a small decline in prices was necessary to wipe out this equity. Unfortunately, deflationary processes are never satisfied with small declines in values. They feed upon themselves and produce results out of all proportion to their causes… In the field of real estate finance, particularly, we have depended so much upon credit that our whole value structure can be thrown out of balance by relatively slight shocks. When such a delicate structure is once disorganized, it is a tremendous task to get it into a position where it can again function normally.”1

Henry Hoagland, 1935

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Ben Bernanke , and Mark Gertler . “Inside the Black Box: The Credit Channel of Monetary Policy Transmission.” The Journal of Economic Perspectives 9, no. 4 (1995): 2748.

Ben Bernanke , Mark Gertler , and Simon Gilchrist . “The Financial Accelerator and the Flight to Quality.” The Review of Economics and Statistics 78, no. 1 (1996): 115.

Price Fishback , Shawn Kantor , and John Wallis . “Can the New Deal's Three R's Be Rehabilitated? A Program-by-Program, County-by-County Analysis.” Explorations in Economic History 40, no. 3 (2003): 278307.

Henry Hoagland . “The Relation of the Work of the Federal Home Loan Bank Board to Home Security and Betterment.” Proceedings of the Academy of Political Science 16, no. 2 (1935): 4552.

Kenneth Snowden . “Building and Loan Associations in the United States, 1880–1893: The Origins of Localization in the Residential Mortgage Market.” Research in Economics 51 (1997): 227–50.

Rosalind Tough . “The Life Cycle of the Home Owners' Loan Corporation.” Land Economics 27, no. 4 (1951): 324–31.

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The Journal of Economic History
  • ISSN: 0022-0507
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