During the Last three years mortgage rates have risen relative to yields on comparable maturity bonds. The questions addressed in the present paper are what is the extent of this increase and to what is it attributable? We find the increase between early 198 and early 1981 in coupon rates on...

The study is divided into four broad parts, beginning with an exploratory analysis of the data on expost returns on corporate equities and bonds for the 1926-80 period. In Part 2, we estimate the relationships between one-month expost returns on corporate bonds and equities andvariations in...

The paper begins with the development of models explaining the mortgage refinancing and assumption decisions of households Having identified the economic variables influencing these decisions, we then simulate the models for different values to determine under what conditions households will...

Current tax law provides tax advantages to owner-occupied housing that increase with a household's income. This well understood fact has led to periodic proposals to substitute a tax credit equal to, say, 25 percent of housing-related expenses for their current deductibility. Because all of the...

This paper presents calculations of the impacts of two levels of mortgage revenue bonds (MRBs) on: (1) yields on home mortgages, tax-exempt bonds and taxable bonds, (2) the allocation of the American fixed capital stock among residential (by three tax brackets), business, and state and local...

In contrast to the conventional wisdom, real estate activity in the aggregate is not disfavored by the 1986 Tax Act. Within the broad aggregate, however, widely different impacts are to be expected. Regular rental and commercial activity will be slightly disfavored, while historic and old...

This study extends recent work that developed and tested economic models of the joint decisions of household formation and homeownership. The cost of shelter is an important determinant of whether youth live independently (apart from parents and other nonrelated adults), and the cost of...

The securitization of fixed-rate mortgages suggests that the FRA/VA market was fully integrated with capital markets by the early l98Os and that the conventional market moved toward integration during the l98Os. Assuming full integration of FHA/VA5 via the GNMA securitization process, we first...

This paper presents a stochastic pricing model of a unique, path-dependent lease instrument common in the United Kingdom and numerous commonwealth countries, the upward-only adjusting lease. In this lease, the rental rate is fixed at lease commencement but will be reset to the market rate at...

This paper suggests that the decline in equity prices, and thus in Tobin's average q, during the 1970s may be attributable to changes in expected relative factor prices. More specifically, q is shown to be a negative function of the extent to which current relative factor price expectations...