Housing investment: What makes it so volatile? Theory and evidence from OECD countries

Quoc Hung Nguyen

Journal of Housing Economics, 2013, vol. 22, issue 3, 163-178

Abstract: This paper explains how mortgage market liberalization can introduce greater volatility in the housing market, which is a stylized fact documented from OECD countries, with a DSGE model where households face a credit constraint and housing is used as collateral. The housing collateral constraint creates a link between the housing market and borrowing capacity, a link that amplifies the response of housing demand to technology shocks and strengthens in economies with more liberalized mortgage markets.

Keywords: Housing investment; Collateral constraint; Mortgage markets (search for similar items in EconPapers)
JEL-codes: E22 E32 F34 F41 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:22:y:2013:i:3:p:163-178

DOI: 10.1016/j.jhe.2013.07.002

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