Secondary housing supply

Andreas Mense

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: I estimate the impact of new housing supply on the local rent distribution, exploiting delays in housing completions caused by weather shocks during the construction phase. Increasing the flow of new supply by 1% lowers average rents by 0.2%, and increases disproportionately the number of second-hand units offered for rent. The supply shock affects the entire rent distribution. Employing a quantitative model, I explain this pattern by secondary supply: New supply triggers a cascade of moves that frees up units in all segments of the local market. The impact on rents is similarly strong in locations experiencing growing housing demand.

Keywords: housing supply; rental housing; rent distribution; secondary markets; market integration (search for similar items in EconPapers)
JEL-codes: D10 D40 R21 R31 (search for similar items in EconPapers)
Pages: 59 pages
Date: 2023-04-01
New Economics Papers: this item is included in nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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http://eprints.lse.ac.uk/118645/ Open access version. (application/pdf)

Related works:
Working Paper: Secondary Housing Supply (2023)
Working Paper: Secondary housing supply (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:118645

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