Booms and busts in housing markets: Determinants and implications

Luca Agnello () and Ludger Schuknecht

Journal of Housing Economics, 2011, vol. 20, issue 3, 171-190

Abstract: This study looks at the characteristics and determinants of booms and busts in housing prices for a sample of eighteen industrialised countries over the period 1980-2007. From an historical perspective, we find that recent housing booms have been amongst the longest in the past four decades. Estimates of a Multinomial Probit model suggest that domestic credit and interest rates have a significant influence on the probability of booms and busts occurring. Moreover, international liquidity plays a significant role for the occurrence of housing booms and--in conjunction with banking crises--for busts. We also find that the deregulation of financial markets has strongly magnified the impact of the domestic financial sector on the occurrence of booms.

Keywords: Housing; prices; Booms; and; busts; Monetary; policies; Credit; growth; Global; liquidity; Financial; deregulation (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (166)

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Working Paper: Booms and busts in housing markets: determinants and implications (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:20:y:2011:i:3:p:171-190

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