A regional model of the Danish housing market

Arbeitspapier

We estimate a regional model of the prices of Danish single-family houses and show that submarkets are interconnected via relative prices, giving rise to a ripple effect. We find strong evidence of a ripple effect in the short run of the model, but less so in the long run. We extend the model to allow for heterogeneity in fundamental elasticities based on factors such as local supply constraints and demographic compositions. We find that house prices are more sensitive to developments in fundamental factors, such as the housing stock, income and user costs in e.g. the Copenhagen area. Additionally, we document that the ripple effect is stronger from Copenhagen to other parts of Denmark than it is in the opposite direction.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Danmarks Nationalbank Working Papers ; No. 121

Classification and Topics

• Classification: Wirtschaft ; Single Equation Models; Single Variables: Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes ; Asset Pricing; Trading Volume; Bond Interest Rates ; Housing Supply and Markets
• Subject: House-price dynamics ; regional house prices ; global VAR models

Contributors, Location and Time

• Event: Geistige Schöpfung
• (who): Hviid, Simon Juul
• Event: Veröffentlichung
• (who): Danmarks Nationalbank
• (where): Copenhagen
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/202861
• Last update: 12.07.2024, 1:22 PM CEST