Expectations and the housing boom and bust. An open economy view

Gete, Pedro

Publication:
Expectations and the housing boom and bust. An open economy view

dc.contributor.author	Gete, Pedro
dc.contributor.funder	Banco de España
dc.contributor.funder	CaixaBank
dc.contributor.funder	Ministerio de Economía y Competitividad
dc.contributor.funder	Agencia Estatal de Investigación
dc.contributor.funder	European Regional Development Fund
dc.contributor.ror	https://ror.org/02jjdwm75
dc.date.accessioned	2024-11-06T17:07:52Z
dc.date.available	2024-11-06T17:07:52Z
dc.date.issued	2020-09
dc.description.abstract	I show that both before and after the Great Recession, housing dynamics strongly correlate with current account dynamics, both across and within countries. In a benchmark DSGE model of housing markets, housing price-to-rent ratios are counterfactual if the transmission channel from housing to the current account is only through the consumption effects from relaxed borrowing constraints. Utilizing a model with enough reallocation of labor between construction and tradable goods resolves the problem. In this model, using survey data on housing price expectations generates dynamics of housing variables and the current account consistent with the data. However, interest rate dynamics are counterfactual.
dc.description.peerreviewed	yes
dc.description.status	Published
dc.format	application/pdf
dc.identifier.citation	Gete, P. (2020). Expectations and the housing boom and bust. An open economy view. Journal of Housing Economics, 49, 101690. https://doi.org/10.1016/j.jhe.2020.101690
dc.identifier.doi	https://doi.org/10.1016/j.jhe.2020.101690
dc.identifier.issn	1096-0791
dc.identifier.uri	https://hdl.handle.net/20.500.14417/3307
dc.journal.title	Journal of Housing Economics
dc.language.iso	en
dc.publisher	Elsevier
dc.relation.department	Finance
dc.relation.entity	IE University
dc.relation.projectID	PGC2018-101745-A-I00
dc.relation.school	IE Business School
dc.rights	Attribution-NonCommercial-NoDerivatives 4.0 International
dc.rights.accessRights	info:eu-repo/semantics/openAccess
dc.rights.uri	http://creativecommons.org/licenses/by-nc-nd/4.0/
dc.subject.keyword	Construction
dc.subject.keyword	Current account
dc.subject.keyword	Expectations
dc.subject.keyword	Global imbalances
dc.subject.keyword	Housing prices
dc.title	Expectations and the housing boom and bust. An open economy view
dc.type	info:eu-repo/semantics/article
dc.version.type	info:eu-repo/semantics/acceptedVersion
dc.volume.number	49
dspace.entity.type	Publication
relation.isAuthorOfPublication	627e06b8-d61f-4611-96fe-15cf32670e9f
relation.isAuthorOfPublication.latestForDiscovery	627e06b8-d61f-4611-96fe-15cf32670e9f