Households in the US may still be vulnerable to a major drop in house prices, according to the results of “stress tests” published in a recent paper by the Federal Reserve Bank of New York.

Andreas Fuster, Benedict Guttman-Kenney, and Andrew Haughwout make use of a new dataset from credit reporting firm Equifax, which allows them to capture both first mortgages and additional lines of credit and home equity loans. They roll these into a “combined loan-to-value” ratio, which offers an early