Interest Rate Elasticity of Residential Housing Prices
Author | : Mr.Martin Cihak |
Publisher | : International Monetary Fund |
Total Pages | : 34 |
Release | : 2008-10-01 |
ISBN-10 | : 9781451871050 |
ISBN-13 | : 1451871058 |
Rating | : 4/5 (50 Downloads) |
Download or read book Interest Rate Elasticity of Residential Housing Prices written by Mr.Martin Cihak and published by International Monetary Fund. This book was released on 2008-10-01 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the interest rate elasticity of housing prices, advancingthe empirical literature in two directions. First, we take a commonly used cross-country panel dataset and evaluate the housing price equation using a consistent estimator in the presence of endogenous explanatory variables and a lagged dependent variable. Second, we carry-out a novel analysis of determinants of residential housing prices in a cross-section of countries. Our results show that the short-term interest rate, and hence monetary policy, has a sizable impact on residential housing prices.