Housing prices in Spain: convergence or decoupling?

Corinna Ghirelli, Danilo Leiva-Leon () and Alberto Urtasun

No 2205, Working Papers from Banco de España

Abstract: In this article, we measure changes over time in the synchronization of housing price cycles across Spanish cities. In doing so, we rely on a regime-switching framework that identifies the housing price cycles of pairs of cities, and simultaneously infers the evolving relation between those cycles. These bilateral relationships are then summarized into an aggregate synchronization index of city-level housing cycles. The estimates suggest that Spanish housing prices have followed a convergence pattern, which picked in 2009 and slightly decreased afterwards. We also identify the cities that have been the main contributors to this convergence process. Moreover, we show that differences in population growth and economic structure are key factors to explain the evolution of housing price synchronization among Spanish cities.

Keywords: housing cycles; synchronization; Spain (search for similar items in EconPapers)
JEL-codes: C32 E31 R11 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2022-01
New Economics Papers: this item is included in nep-cwa, nep-mac and nep-ure
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Related works:
Journal Article: Housing prices in Spain: convergence or decoupling? (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:bde:wpaper:2205

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