Price signals in illiquid markets:The case of residential property in Ireland, 2006-2012
Ronan Lyons ()
Economic Papers from Trinity College Dublin, Economics Department
How do list and sale prices relate to each other over the market cycle? Using a dataset of over 650,000 Irish property listings and transactions between 2006 and 2012, this research examines the relationship between list and sale prices. It applies hedonic methods and exploits information on time-to-sell and time-to-drawdown to decompose the gap between list and sale prices into four spreads: the selection spread, capturing the price difference between properties that sell and all listings; the matching spread, which reflects time-to-sell and is countercyclical; the drawdown spread, reflecting administrative costs; and the counteroffer spread, which is the closest counterpart to a bid-ask spread in the housing market and is procyclical.
Keywords: Housing markets; Search and match; Valuation accuracy (search for similar items in EconPapers)
JEL-codes: D12 D83 G12 R3 (search for similar items in EconPapers)
Pages: 25 pages
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Working Paper: Price Signals and Bid-Ask Spreads in an Illiquid Market: The Case of Residential Property in Ireland, 2006-2011 (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:tcd:tcduee:tep0613
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