Manuelli, Rodolfo; Peralta-Alva, Adrian; Garriga, Carlos - Society for Economic Dynamics - SED - 2012
In this paper we revisit the connection between changes in interest rates, loan-to-value ratios and expectations in inaÌuencing housing prices. We construct a two good general equilibrium model in which housing is a composite good produced using structures and land. We show that changes in...