Winners and Losers in House Markets

Nobuhiro Kiyotaki (), Alexander Michaelides and Kalin Nikolov
Additional contact information
Nobuhiro Kiyotaki: Princeton University

No 2010-5, Working Papers from Central Bank of Cyprus

Abstract: This paper is a quantitatively-oriented theoretical study of the interaction between housing prices, aggregate production, and household behavior over a lifetime. We develop a life-cycle model of a production economy in which land and capital are used to build residential and commercial real estates. We find that, in an economy where the share of land in the value of real estates is large, housing prices react more to an exogenous change in expected productivity or the world interest rate, causing a large redistribution between net buyers and net sellers of houses. Changing financing constraints, however, has limited effects on housing prices.

Keywords: Real estates; land; housing prices; life cycle; collateral constraints (search for similar items in EconPapers)
JEL-codes: E20 G10 R20 R30 (search for similar items in EconPapers)
Pages: 57 pages
Date: 2010-07
New Economics Papers: this item is included in nep-dge, nep-mac and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18)

Downloads: (external link)
https://www.centralbank.cy/images/media/pdf/NPWPE_No5_072010.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cyb:wpaper:2010-5

Access Statistics for this paper

More papers in Working Papers from Central Bank of Cyprus Contact information at EDIRC.
Bibliographic data for series maintained by Anna Markidou ().