Bank Lending and Property Prices in Hong Kong

Stefan Gerlach () and Wensheng Peng
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Wensheng Peng: Hong Kong Monetary Authority

No 122003, Working Papers from Hong Kong Institute for Monetary Research

Abstract: This paper studies the relationship between residential property prices and lending in Hong Kong. This is an interesting topic for three reasons. First, swings in property prices have been extremely large and frequent in Hong Kong. Second, under the currency board regime, monetary policy can not be used to guard against asset price swings. Third, despite the collapse in property prices since 1998, the banking sector remains sound. While the contemporaneous correlation between lending and property prices is large, our results suggest that the direction of influence goes from property prices to bank credit rather than conversely.

Keywords: Property prices; bank lending; Hong Kong (search for similar items in EconPapers)
JEL-codes: E32 E42 G21 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2003-06
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Citations: View citations in EconPapers (13)

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Related works:
Journal Article: Bank lending and property prices in Hong Kong (2005)
Working Paper: Bank Lending and Property Prices in Hong Kong (2004)
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