Fundamentals behind house prices

Bin Li and Zhixiong Zeng

Economics Letters, 2010, vol. 108, issue 2, 205-207

Abstract: We build a two-sector neoclassical growth model with housing to reveal a set of fundamental forces behind the movement of house prices. The relative price of house exhibits secular growth that is determined by sectoral technological progress and factor intensities. Off the balanced growth path, it comoves negatively with the real rate of interest.

Keywords: House; prices; Real; interest; rate; Two-sector; growth (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (3)

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