The transmission and effectiveness of macroprudential policies for residential real estate

Eugen Tereanu, Markus Behn, Jan Hannes Lang and Marco Lo Duca

Macroprudential Bulletin, 2022, vol. 19

Abstract: Macroprudential measures can effectively support the resilience of households and banks and help tame the build-up of residential real estate (RRE) vulnerabilities. By capping the riskiness of new loans, borrower-based measures contribute to moderating RRE vulnerabilities in the short-term and to increasing the resilience of households over the medium term. By inducing banks to use more equity financing, capital-based measures increase bank resilience in the short and medium term but are unlikely to have a significant dampening effect on RRE vulnerabilities during the upswing phase of a financial cycle. The two categories of measures are mainly complementary and many European countries have therefore implemented them in combination in recent years. JEL Classification: G01, G21, G28, E58, R38

Keywords: Borrower-based measures; Capital-based measures; Macroprudential policies; Residential real estate (search for similar items in EconPapers)
Date: 2022-10
Note: 2203070
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