Hot and Cold Seasons in the Housing Market

L. Rachel Ngai and Silvana Tenreyro

CEP Discussion Papers from Centre for Economic Performance, LSE

Abstract: Every year during the second and thirdquarters (the "hot season") housing markets in the UK and the US experience systematic above-trend increases in both prices and transactions. During the fourth and first quarters (the "cold season"), house prices and transactions fall below trend. We propose a search-and-matching framework that sheds new light on the mechanisms governing housing market fluctuations. The model has a "thick-market" effect that can generate substantial differences in the volume of transactions and prices across seasons, with the extent of seasonality in prices depending crucially on the bargaining power of sellers. The model can quantitatively mimic the seasonal fluctuations in transactions and prices observed in the UK and the US.

Keywords: housing market; thick-market effects; search-and-matching; seasonality; house price fluctuations (search for similar items in EconPapers)
JEL-codes: E0 (search for similar items in EconPapers)
Date: 2009-04
New Economics Papers: this item is included in nep-dge, nep-mac and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

Downloads: (external link)
https://cep.lse.ac.uk/pubs/download/dp0922.pdf (application/pdf)

Related works:
Journal Article: Hot and Cold Seasons in the Housing Market (2014)
Working Paper: Hot and cold seasons in the housing market (2014)
Working Paper: Hot and Cold Seasons in the Housing Market (2013)
Working Paper: Hot and cold seasons in the housing market (2013)
Working Paper: Hot and cold seasons in the housing market (2009)
Working Paper: Hot And Cold Seasons in the Housing Market (2009)
Working Paper: Hot and cold seasons in the housing markets (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:cep:cepdps:dp0922

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