History Dependence in the Housing Market

Philippe Bracke and Silvana Tenreyro

American Economic Journal: Macroeconomics, 2021, vol. 13, issue 2, 420-43

Abstract: Using data on the universe of housing transactions in England and Wales over a 20-year period, we document that sale prices and selling propensities are affected by house prices prevailing in the period in which properties were previously bought. Using administrative data on mortgages, we show that cognitive frictions explain most of the history dependence in sale prices, whereas credit frictions are more relevant for selling propensities. We corroborate our analysis with data on online house listings, and we estimate the impact of history dependence on the collapse and slow recovery of housing market activity in the postcrisis period.

JEL-codes: E32 R21 R31 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (9)

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Related works:
Working Paper: History dependence in the housing market (2021)
Working Paper: History dependence in the housing market (2018)
Working Paper: History dependence in the housing market (2018)
Working Paper: History dependence in the housing market (2018)
Working Paper: History Dependence in the Housing Market (2017)
Working Paper: History Dependence in the Housing Market (2016)
Working Paper: History dependence in the housing market (2016)
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DOI: 10.1257/mac.20180241

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