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the Maltese islands, primarily via the mortgage market. This process is characterised by (i) financial extension, in which … more households partake in mortgage finance in their entry to homeownership, and (ii) financial intensity, in which … households accumulate more debt in accessing the property market. In explaining this process, I claim, firstly, that mortgage …
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Household borrowing and spending rise with house prices, particularly for leveraged households, but household spending is not consumption. We propose an alternative borrow-to-invest motive by which house price gains affect household spending on residential investment: rational, leveraged...
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This paper examines house price diffusion across metropolitan areas in the United States. We develop a generalization of the Hamilton and Owyang (2012) Markov-switching model, where we incorporate direct regional spillovers using a spatial weighting matrix. The Markov-switching framework allows...
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