THE 1989-92 CREDIT CRUNCH FOR REAL-ESTATE - A RETROSPECTIVE

This study surveys a broad range of information to establish the degre e to which real estate lending and construction activity decreased in the 1989-92 period owing to a ''credit crunch.'' It reviews the condit ions that led up to the contraction in mortgage lending and constructi on and then documents the extent to which the evidence is consistent w ith a credit crunch in lending for residential and nonresidential cons truction, permanent financing of income properties, and residential mo rtgage lending. Also, this study weighs the relative importance of the credit crunch and other factors that contributed to the falloff in re al estate lending and contrasts the recent period with earlier credit crunch episodes.