A Bird's Eye View of OECD Housing Markets

Abstract

Housing markets have played a prominent role in macroeconomic developments over recent years. For a great part of the 2000s, buoyant housing markets have contributed to sustained economic activity in most OECD countries. But many markets overheated and the collapse of the US subprime mortgage market has been at the epicentre of a deep financial and economic crisis. Against this background, this paper: i) documents housing market developments in 18 OECD countries since the 1970s, putting recent evolutions into historical perspective; ii) examines the drivers of supply and demand for housing; iii) investigates the interactions between housing markets and the wider economy; iv) assesses the responsibilities of housing taxation, monetary policy and financial supervision and regulation in fuelling or amplifying housing booms; v) explores the link between global imbalances and housing booms. Un survol des marchés immobiliers de l'OCDE Les marchés immobiliers ont joué un rôle important dans les évolutions macroéconomiques de ces dernières années. Durant une grande partie des années 2000, des marchés immobiliers dynamiques ont contribué à une activité économique soutenue dans la plupart des pays de l’OCDE. Mais de nombreux marchés se sont emballés et l’écroulement du marché hypothécaire « subprime » aux États-Unis a été à l’épicentre d’une profonde crise financière et économique. Dans ce contexte, ce document : i) analyse les évolutions des marchés immobiliers dans 18 pays de l’OCDE depuis les années 1970, replaçant les développements récents dans une perspective historique ; ii) examine les déterminants de l’offre et de la demande de logements ; iii) étudie les interactions entre les marchés immobiliers et l’économie dans son ensemble ; iv) évalue les responsabilités de la fiscalité du logement, de la politique monétaire, de la régulation et de la supervision financières dans l’alimentation ou l’amplification des « booms » immobiliers ; v) considère le lien entre déséquilibres mondiaux et envolées immobilières.taxation, monetary policy, wealth, global imbalances, financial regulation, saving, house prices, mortgage markets, housing market, marché immobilier, marchés hypothécaires, politique monétaire, épargne, déséquilibres mondiaux, patrimoine, régulation financière, fiscalité, prix des logements

The Monetary Transmission Mechanism: An SVAR Analysis of the Four Municipalities in China

“…Such a pattern is consistent with strong autocorrelation in house prices, resulting in part from extrapolative expectations (Andre, 2010).…”

Modelling the housing market in OECD countries

“…Moreover, Miles and Pillonca (2008) emphasise the positive effect, which emanates from an increase in population in Spain and the United States. André (2010) also highlights the same effect in the case of Ireland, Spain, New Zealand, Canada and the United States. Our long-run results suggest the same impact in these countries except for the United States and Ireland, where the evolution of population has no influence in the long-run equilibrium relationship.…”

“…Furthermore, the role of the supply side of the housing market has also been discussed by André (2010), who analyses the impact of residential investment on real house prices and points to a strong relationship between these two variables in the case of Ireland, Spain, Canada and the Nordic economies. Our results also confirm the existence of a relationship between these elements in the case of Spain and Norway.…”

Economic Resilience: What Role for Policies?

“…A well-functioning and sufficiently large rental market can also help to reduce the pressure on house prices by allowing households to rent when house prices are rising relative to rents (André, 2010). A scarcity of rental housing driven by, for instance, tax systems biased towards homeownership or a tight regulation of rental markets, can lead to a decline in supply of rental accommodation preventing households from renting .…”