On the link between policy uncertainty and housing permits: asymmetric evidence from state-level data in the USA

Bahaman-Oskooee, Mohsen; Ghodsi, Hesam; Hadzic, Muris

doi:10.1108/ijhma-07-2020-0090

Cited by 3 publications

(4 citation statements)

References 40 publications

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“…(2019) also suggests that the relationship is stronger following the structural changes caused by the GFC of 2007. Notably, uncertainty also negatively impacts housing starts and permits as investors and developers adopt more cautious approaches to spending (Bahaman-Oskooee et al ., 2021; Christou et al ., 2019; Nguyen Thanh et al ., 2020). However, Strobel et al .…”

Section: Resultsmentioning

confidence: 99%

“…A time-varying analysis of this relationship by Christou et al (2019) also suggests that the relationship is stronger following the structural changes caused by the GFC of 2007. Notably, uncertainty also negatively impacts housing starts and permits as investors and developers adopt more cautious approaches to spending (Bahaman-Oskooee et al, 2021;Christou et al, 2019;Nguyen Thanh et al, 2020). However, Strobel et al (2020) reported contrary evidence suggesting that uncertainty shocks affect only housing prices but not investment volumes.…”

Section: 7mentioning

confidence: 99%

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Economic uncertainty and direct property performance: a systematic review using the SPAR-4-SLR protocol

Ahiadu,

Abidoye

2023

JPIF

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PurposeThis study systematically reviewed existing literature on the impact of economic uncertainty on property performance to highlight focus areas and spur future research amid unprecedented global uncertainty levels. Conceptually, uncertainty levels and environmental dynamism are related to investors' risk judgement and decision-making.Design/methodology/approachPeer-reviewed journal articles published from 2007 to 2022 were assembled and arranged through the Scientific Procedures and Rationales for Systematic Literature Reviews (SPAR-4-SLR) protocol. The initial search produced 2,028 results from the Web of Science and Scopus databases, which were rigorously purified for a final dataset of 70 articles. These records were subsequently assessed through content analysis, bibliographic modelling, topic modelling and thematic analysis. Recurring themes were visualised using the VOSviewer software.FindingsThe existing literature suggests that economic uncertainty negatively impacts investment volumes, returns and performance. Research has also increased since 2018, with a strong emphasis on the housing sector and developed property markets. Commercial property and emerging markets account for only 10 and 8% of previous research, respectively.Practical implicationsThese findings highlight the negative impact of economic uncertainties on property performance and investment volumes, which necessitate careful risk assessment. Given the high susceptibility of emerging and commercial property markets to uncertainty, these markets warrant further research amid ongoing uncertainty concerns across the globe.Originality/valueGiven current unprecedented levels of global uncertainty, the effects of economic uncertainty have received renewed interest. This study synthesised the current understanding of how different property markets respond to increased uncertainty and outlined future research directions to enhance understanding. Themes and relationships were also integrated into a conceptual map summarising the reported effects of economic uncertainty on housing, commercial property, investment and behaviour in the property market.

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Section: Resultsmentioning

confidence: 99%

Section: 7mentioning

confidence: 99%

Economic uncertainty and direct property performance: a systematic review using the SPAR-4-SLR protocol

Ahiadu,

Abidoye

2023

JPIF

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“…The deviation due to shocks is not reverting to establish an equilibrium relationship. In addition, the joint F-statistic is tested for the validity of the model if the value is greater than the upper bound, even if the variables are a mix of I∼(0) and I∼(1) (Bahaman-oskooee et al , 2020; Aliefendioğlu et al , 2021).…”

Section: Methodsmentioning

confidence: 99%

Interdependence between foreigner housing acquisitions and housing price increase in Turkey during the COVID-19 pandemic era

Salami

Tanrıvermiş

Aliefendioğlu

2023

IJHMA

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Purpose This study aims to establish the relationship between house acquisitions by foreigners (HAF) and house price index (HPI) in Turkey. Design/methodology/approach Due to the nature of this study, the data spans from January 2020 to March 2022. The house price index and the number of foreign house acquisitions across three provinces: Ankara, Izmir and Bursa, and national-level data were obtained from the TurkStat database. Consumer price index (CPI) and Turkish interest rates are control variables. In addition, monthly Turkish interest rates and CPI were obtained from the investing.com and TurkStat database, respectively. Furthermore, this study used autoregressive-distributed lag and Toda Yamamoto Granger causality models to avoid analysis bias. HPI and HAF are the variables used to accomplish the objectives of this study. Findings This study established a short-run equilibrium between foreign house acquisitions at the provincial and national levels. The short-run deviations were adjusted faster, ranging from 57.53% to 89.24% for some provinces, while Izmir is struggling to adjust at 6.48%. Both unidirectional and bidirectional Granger causality evidence suggests that the Turkish house price index increases at the national and provincial levels. This finding suggests the need for continuous policy intervention in the Turkish housing market because house prices play a pivotal role in Turkish economic development and daily lives. Research limitations/implications This study’s scope and single-country study are its limitations. However, those limitations make the findings appropriate for the country of the study rather than generalising the results. Practical implications The study provides empirical evidence that foreign housing acquisition contributes negatively to housing affordability in Turkey and calls for authority intervention. This is because housing is considered shelter, a fundamental need to which citizens are expected to be entitled. Most citizens are low- and medium-income earners who may be unable to afford a house out of their income if it becomes costly. Once the expenditure to secure housing exceeds 30% of their income, it is considered unaffordable. Originality/value To the authors' best knowledge, this is the first empirical study that established the influence of foreign house acquisitions on Turkish house price increases and adversely reduced house affordability by Turkish citizens. The study is the first on foreign Turkish housing acquisition that used both theory of ownership and justice motivation theory to explain HAF.

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“…However, there are several reasons to support that this a restrictive assumption. First, the impact of policy uncertainty on housing production is asymmetric (Bahmani-Oskooee et al , 2021). As policy uncertainty is significantly related with the direction of monetary policy actions, an expansionary policy would impact housing permits differently than contractionary policy.…”

Section: The Models and The Methodsmentioning

confidence: 99%

Do expansionary and contractionary monetary policy have a symmetric impact on housing permits across the USA?

Bahaman-Oskooee

Ghodsi²,

Hadzic

et al. 2023

IJHMA

Self Cite

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Purpose The purpose of this paper is to assess the possibility of asymmetric impact of monetary policy on housing permits issued in each state of the USA. Design/methodology/approach The methodology and approach are based on the linear ARDL and nonlinear ARDL approach to error-correction modeling and asymmetric cointegration. Findings The linear models predict that money supply impact housing permits in 28 states in the short run and only nine states in the long run. However, the asymmetric effects are far more pervasive, highlighting the restrictive nature of the linear model. The results from the nonlinear model show at least one lag of positive and/or negative changes in money supply significantly impacts housing permits in nearly all states. Even in the long run, housing permits in 32 states share a long-run relationship with positive and/or negative changes in money supply. The authors also find contractionary monetary policy has a greater influence on housing permits in most states compared to expansionary policy. Originality/value For the first time, the authors use state-level data and asymmetric approach to assess the impact of monetary policy on house permits issued in each state of the USA.

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On the link between policy uncertainty and housing permits: asymmetric evidence from state-level data in the USA

Cited by 3 publications

References 40 publications

Economic uncertainty and direct property performance: a systematic review using the SPAR-4-SLR protocol

Economic uncertainty and direct property performance: a systematic review using the SPAR-4-SLR protocol

Interdependence between foreigner housing acquisitions and housing price increase in Turkey during the COVID-19 pandemic era

Do expansionary and contractionary monetary policy have a symmetric impact on housing permits across the USA?

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