The impact of supply constraints on house prices in England

Christian Hilber and Wouter Vermeulen ()

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

Abstract: We test the theoretical prediction that house prices respond more strongly to changes in local earnings in places with tight supply constraints using a unique panel dataset of 353 Local Planning Authorities in England between 1974 and 2008. Exploiting exogenous variation from a policy reform, vote shares and historical density to identify the endogenous constraints‐measures, we find that: regulatory constraints have a substantive positive impact on the house price‐earnings elasticity; the effect of constraints due to scarcity of developable land is largely confined to highly urbanised areas; and uneven topography has a quantitatively less meaningful impact.

Keywords: house prices; housing supply; supply constraints; land use regulation (search for similar items in EconPapers)
JEL-codes: N0 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2016-03-01
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (145)

Published in The Economic Journal, 1, March, 2016, 126(591), pp. 358 - 405. ISSN: 0013-0133

Downloads: (external link)
http://eprints.lse.ac.uk/58017/ Open access version. (application/pdf)

Related works:
Journal Article: The Impact of Supply Constraints on House Prices in England (2016)
Working Paper: The impact of supply constraints on house prices in England (2013)
Working Paper: The Impact of Supply Constraints on House Prices in England (2012)
Working Paper: The Impact of Supply Constraints on House Prices in England (2012)
Working Paper: The impact of supply constraints on house prices in England (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:58017

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