The boom and subsequent bust in housing construction and prices over the 2000s is widely regarded as a principal contributor to the Financial Panic of 2007 and the subsequent Great Recession. As of this writing, housing market activity remains at depressed levels as the economy slowly resolves...

Using confidential offer-level data on the US housing market, this paper examines the rounding-off heuristics in the bilateral bargaining process. We demonstrate that home sellers and home buyers follow different rounding-off heuristics. While sellers' list prices cluster more frequently around...

I examine racial bias in the most popular home valuation algorithm and study the algorithm's impact on racial bias in transaction prices. I find statistically significant but economically small racial bias in the algorithm. For example, while Black buyers overpay by 9.3% in prices relative to...

The number 8, pronounced like 'prosperity,' is lucky in Chinese culture; 4, pronounced like 'death' is unlucky. Superstitious beliefs may influence asset prices if transaction participants have cultural preferences for specific numbers. We analyze the relationship between the presence of 8s and...

This study investigates whether the unprecedented liquidity injected in the economy by the U.S Fed through unconventional monetary policy measure, popularly known as quantitative easing (QE), is a systematic factor that can explain the abnormally low U.S. housing starts of recent years. We use...

This paper assesses the predictive power of variables that measure market tightness, such as seller's bargaining power and sale probabilities, on future home prices. Theoretical insights from a stylized search-and-matching model illustrate that such indicators can be associated with subsequent...

Analyzing city-level retail price data for a variety of consumer products, we find that house price changes lead local consumer price changes, but not vice versa. The transmission of the house price changes differs substantially across locations and products. It also hinges on the nature of...

This paper is about investigating how different bank liquidity creation activities affect housing markets. Using data of 401 metropolitan statistical areas/divisions (MSAs/MSADs) of the US between 1990 and 2018, we show that not all bank liquidity creation activities boost housing markets. In...

The COVID-19 pandemic further extended the multi-year housing boom in advanced economies and emerging markets alike against massive monetary easing during the pandemic. In this paper, we analyze the pricing-out phenomenon in the U.S. residential housing market due to higher house prices...