Although the volatility of house prices is often ascribed to demand-side factors, constraints on housing supply have … important and little-studied implications for housing dynamics. I illustrate the strong relationship in city-level data between … the volatility of house prices and the regulation of new housing supply. I then employ a dynamic structural model of …

test methodology proposed by Phillips et al. (2015a,b). Motivated by the theory of financial arbitrage, we examine within a … housing markets …