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Hot and Cold Seasons in the Housing Market

L. Rachel Ngai and Silvana Tenreyro

American Economic Review, 2014, vol. 104, issue 12, 3991-4026

Abstract: Every year housing markets in the United Kingdom and the United States experience systematic above-trend increases in prices and transactions during the spring and summer ("hot season") and below-trend falls during the autumn and winter ("cold season"). House price seasonality poses a challenge to existing housing models. We propose a search-and-matching model with thick-market effects. In thick markets, the quality of matches increases, rising buyers' willingness to pay and sellers' desire to transact. A small, deterministic driver of seasonality can be amplified and revealed as deterministic seasonality in transactions and prices, quantitatively mimicking seasonal fluctuations in UK and US markets. (JEL C78, R21, R31)

JEL-codes: C78 R21 R31 (search for similar items in EconPapers)
Date: 2014
Note: DOI: 10.1257/aer.104.12.3991
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Citations: View citations in EconPapers (127)

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Working Paper: Hot and cold seasons in the housing market (2014) Downloads
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Working Paper: Hot and cold seasons in the housing market (2009) Downloads
Working Paper: Hot And Cold Seasons in the Housing Market (2009) Downloads
Working Paper: Hot and cold seasons in the housing markets (2008) Downloads
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