How the market that made the American Dream was made—and what that history tells us about its future and fluctuations.

When Americans poured into cities and suburbs during the twentieth century, they needed capital to build and own homes. The market that emerged did more than merely provide it: the American mortgage market became the consequential, if occasionally misunderstood, cornerstone of the US financial system.

House Money traces the history of the growth and occasional collapse of the American mortgage market over the last 150 years. Jonathan Rose and Kenneth Snowden show how three major housing-related crises (of the 1930s, 1980s, and 2000s) were not just cyclical events nor bubbles. Rather, they were episodes in a common pattern: shocks produced when the availability of capital in the market was eclipsed by the risk the market took on. Rose and Snowden chart the macro factors that produced these capital/risk asymmetries, showing that in all three crises, the macroeconomic trends—not just bubbles, not banker avarice—conspired to create a downturn despite federal and private safeguards. This illustrates Rose and Snowden’s core principle: housing markets can (and often, must) shoulder considerable risk. When the capital behind that risk evaporates, trouble becomes more likely.

Mining more than a century of economic history, Rose and Snowden show how the institutions and practices in the American mortgage market reflect the push-pulls of its past—both the private innovations and the government interventions. House Money reveals the great risk undertaken in service to American homeownership—and the perennial question of what happens when that risk goes wrong.