On the role of transaction costs and property rights in housing markets

In recent years, the importance of transaction costs and the critical role of property rights in economic analysis have become increasingly emphasised as researchers seek better to understand economic behaviour. These and other institutions offer the housing analyst greater opportunity to evaluate housing choices and housing policies compared to neo-classical economics models of housing. This paper builds upon this growing tradition and examines the leading property rights issues affecting housing in market economies. Specifically, several contractual instruments which are used in housing markets are identified and examined: listing agreements, sales contracts, mortgages, leases and management agreements. Taken together, this paper represents a research agenda for the economics of contractual arrangements in housing markets.