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This paper introduces a novel dimension of household heterogeneity that plays an important role in housing markets. Households who self-assess themselves to be more financially literate are 1) more likely to own a house and 2) take on higher leverage on their home. We solve a heterogeneous agent...
Persistent link: https://www.econbiz.de/10012865607
projected - in line with tax capitalization theory - that the tax decrease would lead to significant increases in house prices … reduction. Our results are largely inconsistent with capitalization theory. For the majority of properties, we find no evidence …
Persistent link: https://www.econbiz.de/10010358459
projected - in line with tax capitalization theory - that the tax decrease would lead to significant increases in house prices … reduction. Our results are largely inconsistent with capitalization theory. For the majority of properties, we find no evidence …
Persistent link: https://www.econbiz.de/10010391445
Institutional investors, such as investment funds, are playing an increasingly important role in residential real estate markets. This raises the possibility that their actions might drive aggregate market outcomes and may change how and which macrofinancial shocks transmit to house prices. In a...
Persistent link: https://www.econbiz.de/10015338881
test methodology proposed by Phillips et al. (2015a,b). Motivated by the theory of financial arbitrage, we examine within a …
Persistent link: https://www.econbiz.de/10012851645
This paper builds a macro model with a financial sector and a housing market to understand the transmission and effects of macroprudential instruments addressing mortgage credit. The model compares the introduction of a loan-to-value ratio (LTV), a countercyclical capital buffer (CCyB)-style...
Persistent link: https://www.econbiz.de/10012034723
We explore the interaction of monetary and macroprudential policy in a simple agent-based model of the housing market. Our model shows that the impact of monetary policy on housing market dynamics is smaller than the impact of macroprudential regulation. While both maximum loan-to-value ratios...
Persistent link: https://www.econbiz.de/10012954236
We examine the relationship between financial development and house prices in the Group of Seven (G7) countries over the period 1870 to 2016. We use parametric panel data models that incorporate interactive fixed effects and non-parametric models that allow us to examine non-linearities and the...
Persistent link: https://www.econbiz.de/10012831189
There is widespread agreement that, in the United States, higher house prices raise consumption via collateral or possibly wealth effects. The presence of similar channels in Canada would have important implications for monetary policy transmission. We trace the impact of shifts in non-price...
Persistent link: https://www.econbiz.de/10011408596
Prompted by the recent US experience, in this chapter, we study the interaction between cycles in credit markets and cycles in housing markets. There is a large growing literature exploring two different approaches: on the one hand, a boom–bust in house prices can generate a boom–bust in...
Persistent link: https://www.econbiz.de/10014024266