Search strategies on the housing market and their implications on price dispersion
Tristan-Pierre Maury () and
Fabien Tripier ()
Journal of Housing Economics, 2014, vol. 26, issue C, 55-80
When an household needs to change its home, two transactions have to be done: buy a new house and sell the preceding one. To do so, the household can either adopt a sequential search strategy or a simultaneous search strategy. In sequential strategies, it first buys (or sells) and only after tries to sell (or buy) to avoid being homeless (or holding two houses). In the simultaneous strategy, the household tries to buy and sell simultaneously on the market. This last strategy can diminish its search costs on the housing market, but exposes the household to the risk of becoming a homeless-renter or a two-houses owner. The literature generally considers only the sequential search strategy. However, we show in this article that the simultaneous strategy is (i) generally welfare improving for households, (ii) sometimes the sole equilibrium strategy, and (iii) at the origin of price dispersion on the housing market.
Keywords: Housing; Search; Price dispersion (search for similar items in EconPapers)
JEL-codes: R2 R3 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:26:y:2014:i:c:p:55-80
Access Statistics for this article
Journal of Housing Economics is currently edited by H. O. Pollakowski
More articles in Journal of Housing Economics from Elsevier
Bibliographic data for series maintained by Nithya Sathishkumar ().