Bubbling Away: Forecasting Real Estate Prices, Rents, and Bubbles in a Transition Economy
Galina An (),
Charles Becker () and
Enoch Cheng ()
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Galina An: Kenyon College
Charles Becker: Duke University
Enoch Cheng: University of Colorado
Comparative Economic Studies, 2021, vol. 63, issue 2, No 5, 263-317
Abstract Real housing prices have both surged and swooned in formerly socialist countries. We use 2000–2017 aggregate housing sales and rental price data from Kazakhstan to explore price movements during boom and stagnation eras, investigating the rent–price ratio’s (RPR) capacity to predict housing returns and rent growth for an emerging post-Soviet economy. RPR predicts returns better during periods of price increases than declines, and its importance in predicting the bubble component diminishes with time. Short-run RPR changes are consistent with rational bubble behavior during the period of secular upswing but different predictive variables matter during price increases and declines.
Keywords: Rent–price ratio; Bubbles; Transition economies; Kazakhstan (search for similar items in EconPapers)
JEL-codes: O18 P30 R21 R30 (search for similar items in EconPapers)
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