Premium
Internet Search Behavior, Liquidity and Prices in the Housing Market
Author(s) -
Dijk Dorinth W.,
Francke Marc K.
Publication year - 2017
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/1540-6229.12187
Subject(s) - market liquidity , economics , the internet , monetary economics , matching (statistics) , shock (circulatory) , demand shock , liquidity crisis , supply and demand , econometrics , microeconomics , statistics , mathematics , computer science , medicine , world wide web
We employ detailed internet search data to examine price and liquidity dynamics of the Dutch housing market. We show that the number of clicks on properties listed online proxies demand and the number of listed properties proxies supply. From this internet search behavior, we create a market tightness indicator and we find that this indicator Granger causes changes in both house prices and housing market liquidity. The results of a panel VAR suggest that a demand shock results in a temporary increase in liquidity and a permanent increase in prices in urban areas. This is in accordance with search and matching models.