scholarly journals International Real Estate Review

2015 ◽  
Vol 18 (4) ◽  
pp. 503-521
Author(s):  
Le Ma ◽  
◽  
Chunlu Liu ◽  

In order to explore the long-run equilibrium in the house prices of different cities, studies on house price convergence have been conducted by a number of researchers. However, the majority of previous studies have neglected the effects of spatial heterogeneity and autocorrelation on house prices. This research improves on the investigation of house price convergence by developing a spatio-temporal autoregressive model based on a framework of panel regression methods. Both spatial heterogeneity and autocorrelation of house prices in different cities are taken into account. Geographical distance and the scale of development of the urban housing market are used to construct temporal varying spatial measurements. The spatio-temporal model is then applied to investigate the long-run equilibrium in the house prices of Australian capital cities. The results confirm that house prices in Sydney approach a steady state in the long run, whereas house prices in Brisbane, Canberra, Melbourne and Perth are able to do with lower confidence. However, little evidence supports the existence of long-run equilibrium in the house prices of Adelaide, Darwin and Hobart.

2013 ◽  
Vol 17 (3) ◽  
pp. 263-277 ◽  
Author(s):  
Le Ma ◽  
Chunlu Liu

Convergences of house prices have been studied for over three decades, but yet have been confirmed because of spatial heterogeneity and autocorrelations in house prices. A spatio-temporal approach was recently proposed to address the spatial and temporal issues related to house prices. However, most previous studies placed the focus on the spatial heterogeneity and autocorrelations from geographical locations, which neglected other spatial factors. In order to overcome this shortfall, this research argued a demographical distance, constructed by demographical structure and housing market scales, to investigate the house price convergences in Australian capital cities. The results confirmed the house price levels in Canberra, Brisbane and Perth converged to the house price level in Sydney.


2021 ◽  
pp. 0308518X2198894
Author(s):  
Peter Phibbs ◽  
Nicole Gurran

On the world stage, Australian cities have been punching above their weight in global indexes of housing prices, sparking heated debates about the causes of and remedies for, sustained house price inflation. This paper examines the evidence base underpinning such debates, and the policy claims made by key commentators and stakeholders. With reference to the wider context of Australia’s housing market over a 20 year period, as well as an in depth analysis of a research paper by Australia’s central Reserve Bank, we show how economic theories commonly position land use planning as a primary driver of new supply constraints but overlook other explanations for housing market behavior. In doing so, we offer an alternative understanding of urban housing markets and land use planning interventions as a basis for more effective policy intervention in Australian and other world cities.


2013 ◽  
Vol 5 (4) ◽  
pp. 167-199 ◽  
Author(s):  
Joseph Gyourko ◽  
Christopher Mayer ◽  
Todd Sinai

We document large long-run differences in average house price appreciation across metropolitan areas over the past 50 years, and show they can be explained by an inelastic supply of land in some unique locations combined with an increasing number of highincome households nationally. The resulting high house prices and price-to-rent ratios in those “superstar” areas crowd out lower income households. The same forces generate a similar pattern among municipalities within a metropolitan area. These facts suggest that disparate local house price and income trends can be driven by aggregate demand, not just changes in local factors such as productivity or amenities. (JEL R11, R23, R31, R52)


2012 ◽  
Vol 15 (1) ◽  
pp. 1-42
Author(s):  
Heeho Kim ◽  
◽  
SaeWoon Park ◽  
Sun Hye Lee ◽  
◽  
...  

This paper studies the abnormal price behavior of Kangnam, a premium (high price) housing submarket in Seoul, Korea, which addresses the correlation between house prices, bank lending, and other factors, including income. Kangnam experienced the most dramatic price escalation during the study period (1999-2009) despite Korean government policies to stabilize house prices in 2005 and the U.S. subprime crisis in 2008. The empirical result shows that even though the house price in a premium market is, to some degree, positively influenced by income, it is not affected by bank lending in the short-run while negatively affected in the long-run. This suggests that a premium housing submarket has a peculiar price dynamics of its own unlike the other submarkets which seem to comply more or less with our notion of a general economic theory, especially in terms of house prices and bank lending.


2021 ◽  
Author(s):  
◽  
Danae Bloxham

<p>The ‘kiwi dream’ of home ownership has become less attainable because of increases in housing costs. Unaffordability is linked with the house price to income ratio, especially within urban environments where incomes have fallen to 50% below property prices. This not only affects access to affordable housing, but also access to quality housing. A home should be dry, warm and safe – these are the key fundamentals of quality housing and people of all ages should have access to a home in which these qualities are not compromised by their personal income. A home that is well insulated, heated, structurally sound and located close to transport nodes should be affordable for all New Zealanders.   Home ownership in New Zealand plays a central role in our national identity. The design research will cater for the younger generation that are most affected by the housing crisis – first home buyers ranging between the ages of 25 and 30,wanting to get their foot on the property ladder and realise the ‘kiwi dream’ of home ownership.   A key issue of New Zealand’s high house prices is the influence of land costs. An intensification strategy to reduce the amount of land per dwelling is one solution to combat house prices. Intensification of New Zealand’s cities should also be targeted at an increase in urban housing along railway corridors, transport hubs and in town centres, improving both housing affordability and transport costs – two main factors of household expenditure. When these two strategies are combined with careful design and space efficient techniques, solutions can be created within a small footprint, without compromising comfort and functionality.   This thesis proposition is tested in Khandallah, one of Wellington’s wealthiest suburbs, with high access to public amenities, transport and services. The suburb already has the infrastructure needed to accommodate intensification. It’s comparatively low density housing holds great opportunity for medium density and infill development. The suburb has a large range of community facilities, schools and open spaces and dwellings are typically of low density with large sites – developed through meandering roads and col-de-sacs of single houses on single sections. With Wellingtons housing needs changing, a greater need for diverse housing throughout all of Wellington’s suburbs is necessary to cater for the growing population. Khandallah has the infrastructure to support intensification and young families should have the option of buying into a suburb of their choice.   The aim of this research is to develop a model for affordable, high quality suburban housing that is responsive to New Zealand’s housing preferences, providing a solution for greater access to desirable housing that occurs through interrelated well designed small homes. This thesis argues that doubling suburban density while retaining site coverage will make housing more affordable. This is tested through planning and spatial design strategies of a range of small homes less than 80m2. These homes will be developed through examining the design of internal spaces; the limits of the small home and relationship with external spaces and the limits of the suburb. The relationship between homes will allow a development of private and common utilities, optimising open space and shared amenities within an intensification strategy for the suburb. The design research produces an argument for clusters of small homes as future housing that will have a positive impact on New Zealand’s housing affordability as ‘starter homes’ and ‘downsize homes’.</p>


2019 ◽  
Vol 27 (4) ◽  
pp. 62-73 ◽  
Author(s):  
Mateusz Tomal

Abstract The aim of this study is to identify whether there is a common house price trend across provincial capitals in Poland. The log t regression is the main method of analysis. Additionally, traditional convergence tests based on the concepts of β- and σ-convergence are used. The obtained results indicate that the cities do not share a common price in the long-run. There are, however, convergence clubs on both primary and secondary markets. In each club, house prices across cities tend to converge to their own steady state. Moreover, research on the driving forces of convergence reports that factors affecting housing prices differ among the clubs. Therefore, policymakers should adjust housing policies in accordance with the characteristics of a given club. In turn, the σ-convergence model demonstrated a very interesting finding, namely, a U-shape pattern of convergence, both on the primary and secondary markets. This pattern is strictly correlated with the level of prices on the markets.


2019 ◽  
Vol 15 (1) ◽  
Author(s):  
Nadia Mbazia ◽  
Mouldi Djelassi

Abstract This paper examines the links between housing and money empirically in a money demand framework for a panel of five Middle East and North Africa (MENA) countries using quarterly data from 2007Q3 to 2014Q4 with the inclusion of house prices as a variable representing the developments in housing markets. We applied the Pool Mean Group Estimation technique to estimate the long-run and short-run dynamic relationships in money demand model. Empirical results provide the evidence that higher house prices lead to a rise in M2 demand in long-run and short-run estimations. This finding may explain the importance influence of the house price developments on monetary policy in MENA countries. The results confirm that the cross-country heterogeneity of money holdings is also connected with structural features of the housing market.


2016 ◽  
Vol 11 (12) ◽  
pp. 127
Author(s):  
Fong Kean Yan ◽  
Yap Lya Keng ◽  
Kwek Kien Teng

The main objective of this research is to investigate the relationship between house price with macroeconomics variables - Gross Domestic Product per capita, inflation rate, Base Lending Rate and amount of household loan disbursed for purchase of residential properties. We try to use these variables to examine if they could trigger a housing bubble to burst in Malaysia. Granger Causality results show that there is univariate relationship from house price to Gross Domestic Product per capita. Though house price and other macroeconomics variables do not Granger–cause each other in short run, but these variables are cointegrated in the long run, i.e. there is no evidence of house price bubble in Malaysia. We suggest that soaring house prices in Malaysia is being supported by the large inflow of foreign funds into the housing sector and the unresponsive supply of houses.


2015 ◽  
Vol 73 (5) ◽  
Author(s):  
Loh Yun Lu ◽  
Janice YM Lee ◽  
Usama Al-mulali ◽  
Nurul Afiqah Ahmad ◽  
Izran Sarrazin Mohammad

House prices in Malaysian cities increased drastically in the past few years, notably in the state of Penang.  The existence of a housing bubble is speculated by major property players. This paper ascertains whether a housing bubble exists in Penang and explores the long-run and short-run determinants of Penang residential prices. Quarterly data (2000Q1 to 2012Q2) of House Price Index is the dependent variable and Gross Domestic Product, Consumer Price Index (CPI), Base Lending Rate (BLR) and Housing Supply as independent variables. Econometric model together with fully modified Ordinary Least Squares regression were used to detect the presence of housing bubble in Penang. The determinants of Penang house prices are based on Granger causality and variance decomposition analysis using the vector autoregressive (VAR) model. The results show no evidence of housing bubble in Penang housing market. CPI has both long-run and short run causality relationship with house prices while CPI and BLR explain a large part of housing price variance. Results show changes in inflation and cost of borrowing will greatly affect Penang house prices.  


2016 ◽  
Vol 20 (4) ◽  
pp. 397-408 ◽  
Author(s):  
Chi-Chuan LEE ◽  
Chien-Chiang LEE ◽  
Shu-Hen CHIANG

This paper examines the stationarity properties, the long-run equilibrium and the leadlag relationship among the regional house prices in China from December 2000 to July 2013. Unlike traditional unit-root tests, the panel seemingly unrelated regressions augmented Dickey-Fuller (SURADF) unit-root test reveals that the regional house prices in China are a mixture of I(0) and I(1) processes. There is concrete evidence in favor of the hypothesis of a long-run equilibrium relationship among all regions, except for Shanghai region, and supporting the price diffusion or ripple effect among these Chinese cities. Finally, we determine that these regional house prices exhibit uni-directional causalities running from Beijing, Chongqing, and Shenzhen to Guangzhou and Tianjin, respectively.


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