Supply, Demand and Prices in the US Housing Market

No 08/RT/12, Research Technical Papers from Central Bank of Ireland

Abstract: The slowdown in the US economy in 2008, and in the housing market in particular, has been accom- panied by a sharp fall in house prices and a glut of homes for sale on the market. While the idea that this overhang of dwellings for sale should place downward pressure on house prices is intuitive, little empirical work has been done in this area. This paper explicitly models the relationship between changes in house prices and various measures of housing supply. The results show that months supply of new homes places greater downward pressure on house prices that the months supply of existing homes. We build a small simulation model to examine the evolution of the housing market.

Keywords: Housing market; supply; prices (search for similar items in EconPapers)
JEL-codes: R21 R31 (search for similar items in EconPapers)
Date: 2012-12
New Economics Papers: this item is included in nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Supply, Demand and Prices in the US Housing Market (2013)
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