An analysis to detect exuberance and implosion in regional house prices in Turkey

Evren Ceritoğlu, Seyit Cilasun (), Ufuk Demiroglu and Aytul Ganioglu

Central Bank Review, 2019, vol. 19, issue 2, 67-82

Abstract: The aim of this paper is to find out whether there is exuberance in regional house prices in Turkey. For this purpose, we analyze real hedonic house prices and price to rent ratios countrywide as well as for 26 geographic regions at the NUTS2 level from January 2010 to January 2019. We perform the right-tailed unit root testing procedures developed by Phillips et al. (2015) and Phillips and Shi (2018) and use their real time date-stamping strategy to determine periods of explosiveness and implosion. Our empirical findings indicate that there were exuberance episodes in house prices in Turkey for multiple periods, where an important contributor to these dynamics was the largest housing market, Istanbul. We also detect exuberance in some other regions, particularly in the neighboring NUTS2 regions of Istanbul and in Izmir after around 2014. However, we find out that explosive price behavior turned into implosion in many regions starting from 2018.

Keywords: Hedonic house prices; Price-to-rent ratio; Explosive price behavior; Right-tailed unit root tests (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.sciencedirect.com/journal/central-bank-review/vol/19/issue/2 (application/pdf)

Related works:
Working Paper: An Analysis to Detect Exuberance and Implosion in Regional House Prices in Turkey (2019)
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:tcb:cebare:v:19:y:2019:i:2:p:67-82

Access Statistics for this article

More articles in Central Bank Review from Research and Monetary Policy Department, Central Bank of the Republic of Turkey Contact information at EDIRC.
Bibliographic data for series maintained by () and () and () and ().