The economic impact of anticipated house price changes-evidence from home sales

Norman G. Miller; Liang Peng; Michael A. Sklarz

doi:10.1111/j.1540-6229.2010.00292.x

The economic impact of anticipated house price changes-evidence from home sales

Norman G. Miller, Liang Peng, Michael A. Sklarz

Risk Management

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21 Scopus citations

Abstract

If realized house prices have the wealth effect and the collateral effect on the economy, anticipated house price changes should have similar economic effects. This article empirically analyzes the effects of single-family home sales, which are shown to be able to predict house prices in the literature, on economic production, using 372 metropolitan statistic areas in the United States from the first quarter of 1981 to the second quarter of 2008 in a panel vector error correction model. Changes in home sales are found to Granger because the growth rate of per-capita gross metropolitan product and the dynamic effects are visualized with impulse response functions. Supporting evidence for the economic impact of home sales is also found in contemporaneous regressions.

Original language	English (US)
Pages (from-to)	345-378
Number of pages	34
Journal	Real Estate Economics
Volume	39
Issue number	2
DOIs	https://doi.org/10.1111/j.1540-6229.2010.00292.x
State	Published - Jun 2011

All Science Journal Classification (ASJC) codes

Accounting
Finance
Economics and Econometrics

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10.1111/j.1540-6229.2010.00292.x

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abstract = "If realized house prices have the wealth effect and the collateral effect on the economy, anticipated house price changes should have similar economic effects. This article empirically analyzes the effects of single-family home sales, which are shown to be able to predict house prices in the literature, on economic production, using 372 metropolitan statistic areas in the United States from the first quarter of 1981 to the second quarter of 2008 in a panel vector error correction model. Changes in home sales are found to Granger because the growth rate of per-capita gross metropolitan product and the dynamic effects are visualized with impulse response functions. Supporting evidence for the economic impact of home sales is also found in contemporaneous regressions.",

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The economic impact of anticipated house price changes-evidence from home sales

Abstract

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