House price diffusion of housing submarkets in Greater Sydney

Mustapha Bangura and Chyi Lin Lee

Housing Studies, 2020, vol. 35, issue 6, 1110-1141

Abstract: Despite numerous studies investigating house price diffusion between regional cities, few have considered a spillover effect among housing submarkets within a metropolitan city. This study expands upon the limited literature to examine house price diffusion of housing submarkets (namely, low-priced and high-priced submarkets) in Greater Sydney, one of the most diverse housing markets in Australia, using convergence tests, cointegration techniques, Granger causality and dynamic ordinary least square cointegration tests. The results show that a long-run relationship in house prices exists between these two submarkets in Greater Sydney. Importantly, the empirical results show that a large degree of diffusion takes place from the less prosperous submarket to the high-end submarket. This supports the equity transfer hypothesis via a filtering process in which house prices in the low-priced submarket will be transmitted into the high-priced submarket. The study also finds that the low-priced submarket is the primary reactor to changes in economic fundamentals. These findings have some profound implications for policy-makers and housing investors.

Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
http://hdl.handle.net/10.1080/02673037.2019.1648772 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:chosxx:v:35:y:2020:i:6:p:1110-1141

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/chos20

DOI: 10.1080/02673037.2019.1648772

Access Statistics for this article

Housing Studies is currently edited by Chris Leishman, Moira Munro, Ray Forrest, Alex Schwartz, Hal Pawson and John Flint

More articles in Housing Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().