The Ups and Downs of New Zealand House Prices

Viv Hall and John McDermott ()
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John McDermott: Victoria University of Wellington

No 06_03, Working Papers from Motu Economic and Public Policy Research

Abstract: This paper identifies the expansion and contraction phases of New Zealand's national and regional house prices, by employing techniques typically used to study cycles in real activity, the so-called Classical cycle dating method. We then enquire into the nature of the cycles, addressing five questions: (1) What are the New Zealand and regional house price cycles, and do the regional cycles differ from the national cycle?; (2) What are the typical durations, magnitudes and shapes of these house price cycles?; (3) Do cycles in house prices match cycles in economic activity, at either national or regional levels?; (4) Does it matter which of the two main sets of house price series are used? i.e. Quotable Value New Zealand (QVNZ) or Real Estate Institute of New Zealand (REINZ)?; and (5) Does the sample period matter? Findings are evaluated in the context of work by Grimes, Aitken and Kerr (2004), and Hall and McDermott (2005). Avenues for further research are suggested.

Keywords: House price cycles; regional business cycles; classical business cycle; New Zealand (search for similar items in EconPapers)
JEL-codes: C22 E31 E32 R11 R15 R21 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2006-07
New Economics Papers: this item is included in nep-mac and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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