2012
DOI: 10.1177/0042098012458551
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‘Ripple’ Effects in South African House Prices

Abstract: This paper analyzes the so-called "ripple" effect of house prices in large-, medium-and smallsized houses of five major metropolitan areas of South Africa, namely, Cape Town, Durban Unicity, Greater Johannesburg, Port Elizabeth/Uitenhage and Pretoria, based on available quarterly data covering the period of 1966:Q1 to 2010:Q1. Following the extant literature, we contextualize the issue as a unit root problem, with one expecting the ratios of metropolitan house price to national house price to exhibit stationar… Show more

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Cited by 59 publications
(46 citation statements)
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“…A number of studies have been conducted for the South African housing sector focusing on forecasting housing prices, impact of monetary policy on housing prices, "ripple" effects and convergence, and the impact of housing prices on consumption (a few recent examples: Burger and van Rensburg, 2008;Gupta & Das, 2008;Das, Gupta, & Kabundi, 2009;Gupta, Jurgilas, & Kabundi, 2010;Das, Gupta, & Kaya, 2010;Balcilar, Gupta, & Shah, 2011;Balcilar, Beyene, Gupta, & Seleteng, forthcoming; Das, Gupta and Kanda, 2011), however, none of the papers have shed light into the relationship between housing and general prices in South Africa to date.…”
Section: Introductionmentioning
confidence: 99%
“…A number of studies have been conducted for the South African housing sector focusing on forecasting housing prices, impact of monetary policy on housing prices, "ripple" effects and convergence, and the impact of housing prices on consumption (a few recent examples: Burger and van Rensburg, 2008;Gupta & Das, 2008;Das, Gupta, & Kabundi, 2009;Gupta, Jurgilas, & Kabundi, 2010;Das, Gupta, & Kaya, 2010;Balcilar, Gupta, & Shah, 2011;Balcilar, Beyene, Gupta, & Seleteng, forthcoming; Das, Gupta and Kanda, 2011), however, none of the papers have shed light into the relationship between housing and general prices in South Africa to date.…”
Section: Introductionmentioning
confidence: 99%
“…Canarella et al (2012), also studied the house price ripple effect in the USA by combining the generalised least squares version of the ADF with non-linear unit root tests and other procedures that control for structure breaks. The Bayesian and panel seemingly unrelated regressions augmented Dickey-Fuller (SURADF) methods for testing unit roots have also been used by a section of the housing literature (Balcilar et al, 2012;Lee and Chien, 2011;Holmes, 2007).…”
Section: The Empirical Literaturementioning
confidence: 99%
“…This impression has stimulated our interest in the notion that Amsterdam house price development ripples to other Dutch regional housing markets. The ripple effect is conceptually a market phenomenon in which house price shocks in one region spread out their influence to house prices in other parts of the country (Meen, 1999;Nanda and Yeh, 2014;Balcilar et al, 2012). It manifests itself by way of house prices appreciating (down-turning) in one location, and subsequently appreciating (down-turning) in other regions (Giussani and Hadjimatheou, 1991).…”
Section: Introductionmentioning
confidence: 99%
“…An extensive review of the literature is provided by Balcilar et al (2013) and most recently by Nanda and Yeh (2014) and Gong et al (2016).…”
Section: Extant Literaturementioning
confidence: 99%