scholarly journals International Real Estate Review

2017 ◽  
Vol 20 (3) ◽  
pp. 251-286
Author(s):  
Steven C. Bourassa ◽  
◽  
Donald Haurin ◽  
Keyword(s):  
Housing Market ◽  
House Price ◽  
Housing Affordability ◽  
Property Taxes ◽  
Metropolitan Statistical Area ◽  
User Cost ◽  
Price Inflation ◽  
Property Insurance ◽  
Mortgage Interest ◽  
Tax Deductions

This paper outlines an approach to constructing a Dynamic Housing Affordability Index (DHAI) that reflects the anticipated cost of owner-occupied housing and performs well in tracking changes in the demand for homeownership and other aspects of the housing market. Our index is grounded in the user cost theory and influenced by variations in the price of housing, mortgage interest and property tax rates, property insurance, transaction costs, and depreciation and maintenance. It takes into account the benefits from U.S. income tax deductions for mortgage interest and property taxes, and considers the role of expected house price inflation in reducing the cost of housing. We show that the DHAI is correlated with national and regional consumer sentiment which reflects the demand for owner-occupied housing, regional and metropolitan statistical area (MSA) homeownership rates, housing market characteristics including housing starts, and sales of new and existing housing. There is evidence that the DHAI performs better than other popular measures of affordability.

scholarly journals The role and significance of planning in the determination of house prices in Australia: Recent policy debates

2021 ◽  
pp. 0308518X2198894
Author(s):  
Peter Phibbs ◽  
Nicole Gurran
Keyword(s):  
Land Use ◽  
Housing Market ◽  
Land Use Planning ◽  
House Prices ◽  
Housing Prices ◽  
House Price ◽  
Evidence Base ◽  
Urban Housing ◽  
Price Inflation ◽  
Depth Analysis

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.

scholarly journals Housing Prices in Unregulated Markets: Study on Verticalised Dwellings in Santiago de Chile

Buildings ◽  
2019 ◽  
Vol 10 (1) ◽  
pp. 6 ◽  
Author(s):  
José Francisco Vergara-Perucich ◽  
Carlos Aguirre-Nuñez
Keyword(s):  
Housing Market ◽  
Affordable Housing ◽  
Housing Prices ◽  
House Price ◽  
Housing Price ◽  
Housing Affordability ◽  
Price Formation ◽  
Land Values ◽  
Santiago De Chile ◽  
Data Transparency

Chile faces a housing affordability crisis, given that most of the population is unable to secure a house. While housing prices between 2008 and 2019 increased by 63.96%, wages only increased by 21.85%. This article presented an analysis of the housing price configuration for the main borough in the country—Santiago. The assessment focused on verticalised housing constructed between 2015 and 2019. The article developed an exploratory study on the price of housing in Santiago to generate a diagnosis to identify the role played by expectations of profitability when configuring price. Based on the information generated, we sought to contribute to the discussion on public policies that advance the development of affordable housing in central boroughs with high urban value, as is the case for Santiago’s borough of Greater Santiago. We hypothesised that profit expectation of real estate developers plays a key role in the housing prices, and an adjustment in the profit ratios might increase the affordability while keeping the housing market above profitable rates. This research addressed the lack of data transparency in the Chilean housing market with archival research, reconstructing costs and earnings from projects based on official registrations of transactions at the borough level. In Chile, the access to investment costs, land values, yields, and house price formation are not publicly available, even though these factors imply that many households are facing severe difficulties in paying for and accessing decent housing.

scholarly journals HOUSING POLICIES IN SINGAPORE: EVALUATION OF RECENT PROPOSALS AND RECOMMENDATIONS FOR REFORM

2014 ◽  
Vol 59 (03) ◽  
pp. 1450025 ◽  
Author(s):  
SOCK-YONG PHANG ◽  
DAVID LEE ◽  
ALAN CHEONG ◽  
KOK-FAI PHOON ◽  
KAROL WEE
Keyword(s):  
Housing Market ◽  
House Prices ◽  
Supply And Demand ◽  
Housing Prices ◽  
Housing Affordability ◽  
Property Taxes ◽  
Housing Supply ◽  
Housing Policies ◽  
Global Liquidity ◽  
The Government

The Singapore housing market is unusual in its high homeownership rate, the dominance of HDB housing, and the extensive intervention of the government in regulating housing supply and demand in both the HDB and private housing sectors. Recent rapid population increases in a low interest rate and high global liquidity environment has resulted in accelerated house prices increases in Singapore. Earlier this year, the government launched "Our Singapore Conversation" of which discussion on housing policies constitutes one major component. This "conversation" comes in the wake of several consecutive rounds of measures to stabilize housing prices using various instruments. This paper evaluates the main policy changes proposed and makes recommendations for housing market reforms: (i) the government need to clarify goals of housing policies and make available more detailed data on the foreign component of our population for better analysis of housing markets; (ii) the housing supply regime should target an overall effective vacancy rate that encompasses both the Housing and Development Board (HDB) and private sector; (iii) policy makers need to monitor carefully excess demand indicators for housing in addition to housing affordability indicators over the entire spectrum of incomes and household types; (iv) housing REITs should be established to provide an alternative investment option as well as to develop an efficient and affordable rental sector; and (v) in addition to macroprudential measures, owner-occupancy requirements and fiscal measures such as stamp duties and property taxes could be further utilized to reduce the foreign demand for Singapore housing and real estate.

scholarly journals ARIMA modelling of Lithuanian house price index

2015 ◽  
Vol 8 (1) ◽  
pp. 135-147 ◽  
Author(s):  
Arvydas Jadevicius ◽  
Simon Huston
Keyword(s):  
Housing Market ◽  
Market Price ◽  
House Price ◽  
Investment Strategy ◽  
Price Inflation ◽  
Price Changes ◽  
Content Type ◽  
Time Series Modelling ◽  
Price Movements ◽  
Modelling Approach

Purpose – This paper aims to investigate Lithuanian house price changes. Its twin motivations are the importance of information on future house price movements to sector stakeholders and the limited number of related Lithuanian property market studies. Design/methodology/approach – The study employs ARIMA modelling approach. It assesses whether past is a good predictor of the future. It then examines issues relating to an application of this univariate time-series modelling technique in a forecasting context. Findings – As the results of the study suggest, ARIMA is a useful technique to assess broad market price changes. Government and central bank can use ARIMA modelling approach to forecast national house price inflation. Developers can employ this methodology to drive successful house-building programme. Investor can incorporate forecasts from ARIMA models into investment strategy for timing purposes. Research limitations/implications – Certainly, there are number of limitations attached to this particular modelling approach. Firm predictions about house price movements are also a challenge, as well as more research needs to be done in establishing a dynamic interrelationship between macro variables and the Lithuanian housing market. Originality/value – Although the research focused on Lithuania, the findings extend to global housing market. ARIMA house price modelling provides insights for a spectrum of stakeholders. The use of this modelling approach can be employed to improve monetary policy oversight, facilitate planning for infrastructure or social housing as a countercyclical policy and mitigate risk for investors. What is more, a greater appreciation of Lithuania housing market can act as a bellwether for real estate markets in other trade-exposed small country economies.

Assessing Dutch housing cycle and near-term market prospects

2020 ◽  
Vol 13 (2) ◽  
pp. 257-270
Author(s):  
Arvydas Jadevicius ◽  
Peter van Gool
Keyword(s):  
Housing Market ◽  
House Prices ◽  
House Price ◽  
Future Market ◽  
Price Inflation ◽  
Content Type ◽  
Dutch Housing ◽  
The Usa ◽  
Near Term ◽  
The Uk

Purpose This study is a practice undertaking examining three main concerns that currently dominate Dutch housing market debate: how long is the cycle, will the current house price inflation continue and is housing market in a bubble. With national house prices reaching record highs across all major cities, future market prospects became a topic of significant debate among policymakers, investors and the populace. Design/methodology/approach A triangulation of well-established academic methods is used to perform investigation. The models include Hodrick-Prescott (HP) filter, volatility autoregressive conditional heteroskedasticity (ARCH approximation) and right tail augmented Dickey–Fuller (Rtadf) test (bubble screening technique). Findings Interestingly, over the years from 1985 to 2019 research period, filtering extracts only one Dutch national housing cycle. This is a somewhat distinct characteristic compared to other advanced Western economies (inter alia the UK and the USA) where markets tend to experience 8- to 10-year gyrations. Volatility and Rtadf test suggest that current house prices in most Dutch cities are in excess of historical averages and statistical thresholds. House price levels in Almere, Amsterdam, The Hague, Groningen, Rotterdam and Utrecht are of particular concern. Originality/value Retail investors should therefore be cautious as they are entering the market at the time of elevated housing values. For institutional investors, those investing in long-term, housing in key Dutch metropolitan areas, even if values decline, is still an attractive investment conduit.

Good Inflation, Bad Inflation: The Housing Boom, Economic Growth and the Disaggregation of Inflationary Preferences in the UK and Ireland

2009 ◽  
Vol 11 (3) ◽  
pp. 461-478 ◽  
Author(s):  
Colin Hay
Keyword(s):  
Monetary Policy ◽  
House Price ◽  
Private Debt ◽  
Price Inflation ◽  
Mortgage Interest ◽  
Price Bubble ◽  
Housing Boom ◽  
Time Inconsistent ◽  
The Uk ◽  
House Price Bubble

This article presents a comparative analysis of the determinants, sustenance and broader macroeconomic consequences of the ultimately unsustainable housing boom in Ireland and the UK in recent years. It examines, in particular, the role played by ostensibly depoliticised monetary policy in both contexts in the development of a house price bubble that has served to fuel consumer-led growth. It assesses the viability, sustainability and reproducibility of the private debt-financed consumer boom that house price inflation has generated. In the process it draws attention to the increasingly differentiated character of both government inflationary preferences and counter-inflationary performance—with the shift to official measures of inflation that exclude mortgage interest repayments and, in the UK at least, to the covert re-politicisation of monetary policy. It concludes by suggesting that governments may well not have time-inconsistent inflationary preferences so much as sectorally specific inflationary preferences. This might be summarised in terms of the aphorism: ‘retail price inflation bad, house price inflation good’.

Housing

2021 ◽  
pp. 660-678
Author(s):  
Tony Fahey ◽  
Michelle Norris
Keyword(s):  
Social Housing ◽  
Social Inequalities ◽  
Home Ownership ◽  
House Price ◽  
Wealth Inequality ◽  
Safety Net ◽  
Housing Affordability ◽  
Welfare States ◽  
Housing Provision ◽  
Price Inflation

This chapter identifies the provision of affordable housing as a key challenge for contemporary welfare states. Rising house prices have undermined many of the mechanisms governments traditionally used to promote housing affordability and have made the challenge of affordability more urgent and more difficult. These forces have also intensified long-standing tensions regarding the role of housing in welfare states, particularly its contribution to achieving two primary distributional aims of social policies: providing a social safety net for the economically vulnerable and mitigating broader social inequalities. Much research on the first aim has focused on policy inputs—particularly social housing provision—rather than on the outcomes they achieve. Consequently, we know less about the affordability benefits generated by social housing than we should. However, in many countries, reductions in exchequer capital subsidies for social housing provision mean that the sector is now largely self-funded from tenants’ rents. Therefore, the large social housing sectors in Western Europe are no longer a guarantee of affordable rents. Subsidies for home ownership are often criticized as a regressive measure, which conflicts with social policy’s equality aim. However, homeowner housing remains the most widely and progressively distributed form of wealth and its contraction in the face of strong house price inflation in recent decades will precipitate increased wealth inequality. Policy responses to this inflation have concentrated on regulating home buyers’ access to mortgage credit, which may impede their ability to buy. Therefore, policies are also needed to improve the supply side of housing and make it more responsive to demand.

Homeownership and the Accumulation of Real Wealth

1989 ◽  
Vol 7 (1) ◽  
pp. 69-91 ◽  
Author(s):  
B A Badcock
Keyword(s):  
Housing Market ◽  
House Price ◽  
Urban Housing ◽  
Capital Gains ◽  
Wealth Accumulation ◽  
Property Market ◽  
Urban Restructuring ◽  
Price Inflation ◽  
Capital Growth ◽  
Generative Mechanisms

The contention surrounding the significance of homeownership for social theory is reviewed, after which it is suggested that the conceptualisation of wealth accumulation for homeownership has yet to comprehend fully the ‘generative mechanisms' underlying capital gains or losses. There is a need to advance beyond the rather limited analysis developed by Thorns in 1981, to a consideration of the connections between urban restructuring, the transfer of value, and capital growth within the urban housing market. Trends in Adelaide's separate-housing market, 1968–75, are outlined to provide a context for the central question; that is, what is the relationship between class position and house price inflation? Too much temporal and spatial variability is encountered in a number of estimates of capital growth in the separate-house submarket to sustain the claim that this source of accumulation systematically favours those homeowners with the greatest real investment in housing. Regression analysis is used to demonstrate that at least some of the variability in capital gains or losses can be accounted for by indicators that relate to processes of urban restructuring. Further clarification of the theoretical significance of homeownership for social reconstitution must await a longitudinal study of the passage of households through the domestic property market in the course of a lifetime.

An examination of house price bubble in the real estate sector: the case of a small island economy – Fiji

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohsin Khan ◽  
Rup Singh ◽  
Arvind Patel ◽  
Devendra Kumar Jain
Keyword(s):  
Housing Market ◽  
Negative Impact ◽  
Positive Impact ◽  
House Price ◽  
Policy Implications ◽  
Small Island ◽  
Price Inflation ◽  
Content Type ◽  
Price Bubble ◽  
House Price Bubble

Purpose This paper aims to assess the equilibrium house price in the city of Suva (Fiji) and to analyse the house price bubble in the Fiji housing market. Design/methodology/approach This paper adopts a time series approach to determine the presence of house price bubbles in Fiji over the period from 1988 to 2018. Findings The findings suggest that real income, land cost, building material price, inflation rate, volatility, household size and wealth have a positive impact on house prices, whereas user cost of capital and political disturbances have a negative impact. The findings further indicate that the Fijis’ housing market does not constitute any house price bubble. Practical implications This paper draws policy implications for a small developing state (Fiji) and other similar economies. Originality/value The price bubble in the Fiji housing market is analysed for the first time. This paper develops a comprehensive empirical approach to assess the equilibrium-housing price in Fiji.

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