Recent developments in house prices in Macedonia

We overview developments in house prices in Macedonia in the period 2000-2013, with a special focus on the movements during the Great Recession. House prices in Macedonia exhibit typical cyclical behaviour, where periods of growth are followed by periods of stagna- tion/decline. Price developments are well explained by standard fundamentals, such as income, mortgages and supply of new housing, and during these 14 years houses have not shown signs of substantial and persistent mispricing. Real house prices have declined by approximately 17 percent since the onset of the global …nancial crisis (end of 2008). The decline is in accor- dance with the lower demand during this period (due to the stagnation in real income and the slowdown in the credit growth) and the higher supply of new housing.