Dynamic Impact of Macroeconomic Indicators on U.S. Housing Market: A Panel Data Analysis from 2003 to 2022

This research examines the effect of several economic factors, such as the unemployment rate, producer price index, bank benchmark lending rate, mortgage interest rate, and S&P/Case-Shiller house price index, on the median home price in the United States. By employing panel data spanning from 2003 to 2022, this study utilizes multiple regression models to uncover the influence of various factors on house prices over several economic cycles. The findings indicate a strong and positive correlation between the S&P/Case-Shiller home price index and median house prices. Simultaneously, there is a strong and negative correlation between the unemployment rate, bank lending rates, and mortgage rates and median home prices. Additionally, rises in the producer price index are the main driver of house price increases. The study emphasizes the critical need for dynamic adjustment of economic policies and suggests policy recommendations such as focusing on interest rate policies, promoting employment and controlling construction costs to achieve a stable and sustainable housing market. At the same time, the study also suggests that other factors that may affect house prices be further explored in the future.