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Consumption, Housing Rents and Housing Price: A Test Of A Real Estate Pricing Model Using Hong Kong Data
Author(s) -
Cheung Francis K.,
Ni Shawn,
Siu Alan
Publication year - 2003
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/1468-0106.00181
Subject(s) - real estate , economic rent , capital asset pricing model , economics , consumption based capital asset pricing model , consumption (sociology) , capitalization rate , asset (computer security) , financial economics , econometrics , microeconomics , real estate investment trust , finance , social science , computer security , sociology , computer science
The present study investigates whether Hong Kong's volatile real estate market is consistent with a non–linear consumption–based–asset–pricing model. It finds that the asset–pricing model is not rejected for some types of properties. However, the differentials between the returns to residential properties and risk–free rate are too large to be explained by the model.