Monetary policy and housing prices

Arbeitspapier

In this paper we study the determination of housing prices. We are particularly interested in how monetary policy affects housing prices. First we derived the explanatory variables for housing prices from the utility maximisation framework. In this setting housing prices are determined by income, wealth, the user cost of housing, the demographic factor, and the supply of housing. In addition, our survey of the theoretical literature indicates that monetary policy affects housing prices through the user cost as well as through the liquidity of the households and through the changes in the valuation of alternative assets. In the empirical part of the paper we ran regressions on data from the Helsinki area. Quarterly data from years 1973 -87 was used. Interest rate was found to be a significant explanatory variable in determining housing priees. Also net migration into Helsinki area and taxable wealth turned out to be of equal importance.

Object Details

• ISBN: 951-686-160-1
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Bank of Finland Discussion Papers ; No. 15/1988

Classification and Topics

• Classification: Wirtschaft

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Kerttula, Anne ; Mikkola, Anne
• Event: Veröffentlichung
• (who): Bank of Finland
• (where): Helsinki
• (when): 1988

Further information

• Handle: http://hdl.handle.net/10419/211518
• Last update: 10.03.2025, 11:45 AM CET