Housing market dynamics have primarily shifted from consumption- to investment-driven in many countries, including Australia. Building on investment theory, we investigated by placing demand at the center using error correction model (ECM). We found that house prices, rents, and interest rates are cointegrated long run under present value framework. Other economic factors such as population gro...

A model which explains national-level house price appreciation through utility maximization by rational voters is developed and tested using a global sample of 40 democracies, in order to explain why some countries experienced house price bubbles in the past decade and others did not. In the model, a subsidy funded by a tax on all citizens can be provided to home buyers. The subsidy leads to an...

Abstract Exploiting data on tens of millions housing transactions, we show that (1) house prices grew by less in manufacturing-heavy US regions, (2) this pattern is especially present for the lowest-value homes and (3) price declines coincided with worse labour market outcomes, consistent an income channel. Counterfactual accounting exercises reveal regional differences growth these are importa...