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The Economic Impact of Anticipated House Price Changes—Evidence from Home Sales
Author(s) -
Miller Norman G.,
Peng Liang,
Sklarz Michael A.
Publication year - 2011
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/j.1540-6229.2010.00292.x
Subject(s) - economics , metropolitan area , quarter (canadian coin) , gross domestic product , house price , collateral , per capita , economic impact analysis , macroeconomics , monetary economics , econometrics , agricultural economics , labour economics , finance , microeconomics , population , demography , archaeology , sociology , medicine , pathology , history
If realized house prices have the wealth effect and the collateral effect on the economy, anticipated house price changes should have similar economic effects. This article empirically analyzes the effects of single‐family home sales, which are shown to be able to predict house prices in the literature, on economic production, using 372 metropolitan statistic areas in the United States from the first quarter of 1981 to the second quarter of 2008 in a panel vector error correction model. Changes in home sales are found to Granger because the growth rate of per‐capita gross metropolitan product and the dynamic effects are visualized with impulse response functions. Supporting evidence for the economic impact of home sales is also found in contemporaneous regressions.