I document the role of a credit crunch in driving the housing market in the 1970s. Binding Regulation Q ceilings tightened funding and induced a credit crunch across the financial sector. I show that the crunch was particularly severe in housing because the primary mortgage lenders, savings and loan associations (S&Ls), lacked the funding flexibility banks had. Banks could substitute rate-capped retail deposits with wholesale funds exempt from the ceiling, whereas S&Ls could not. At the local level, a 1 pp tightening in the effective S&L ceiling is followed over the next year by a 4.7 pp drop in the mortgage growth rate and a 1.1 pp drop in the real house price growth rate. Effects through banks are muted. This mechanism operates alongside demand-side explanations and helps to explain the joint boom-bust patterns in prices and quantities in the housing market during this era.