Secondary housing supply

Andreas Mense

No 05/2021, FAU Discussion Papers in Economics from Friedrich-Alexander University Erlangen-Nuremberg, Institute for Economics

Abstract: I estimate the impact of new housing supply on the local rent distribution, exploiting weather shocks during the construction phase as an instrument. New supply decreases rents at all quality levels. Building on a quantitative dynamic model of housing quality and tenure choice, I explain this pattern by secondary housing supply: New supply to the owner-occupier market triggers a cascade of moves in the rental market, freeing up units across the housing quality spectrum. This mechanism has implications for housing policy, the integration of the housing market, and the integration of new- and used-product markets in general.

Keywords: secondary markets; market integration; housing markets; rent distribution; dynamic housing choice (search for similar items in EconPapers)
JEL-codes: D15 D40 R21 R31 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-isf and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Working Paper: Secondary housing supply (2023)
Working Paper: Secondary Housing Supply (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:iwqwdp:052021

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