Homeowner-made housing price bubbles : East Germany’s example

This paper argues that homeowners, if sufficiently influential, may attempt to manipulate housing prices. The paper presents an instance of, and sets out the political economy behind, one particular homeowner-made housing price bubble (in East Germany). Yet ultimately the paper suggests that homeowners may be responsible for housing price bubbles elsewhere, too. Namely, US homeowners may be the single driving force behind the latest US housing price boom that preceded the current real estate, and financial, crisis. -- Homeowner Majority ; Rent Persistence ; Ratchet Effect ; Policy Reform