Open AccessInternational Real Estate Review
Author(s) -
Ching-Chun Hua,
ChinOh Chang,
Chengho Hsieh
Publication year - 2001
Publication title -
journal of the asian real estate society
Language(s) - English
Resource type - Journals
ISSN - 1029-6131
DOI - 10.53383/100030
Subject(s) - real estate , factor market , economics , economic shortage , market price , market microstructure , market depth , stock market , business , monetary economics , microeconomics , order (exchange) , finance , paleontology , linguistics , philosophy , horse , government (linguistics) , biology
In Taiwan, the housing market can be separated into the existing housing market and the pre-sales market. The existing market can be regarded as the stock market, and the pre-sales market the flow market. However, some unique characteristics exist in the Taiwan market. Based on these characteristics, we modified the conventional housing stock-flow model to describe the price -volume relationship between the existing and pre-sales markets. Empirical models are constructed to test the relationship. Major findings are: 1) both the pre-sales price and the existing price converge to the long-run equilibrium; however, the pre-sales price adjusts faster than the existing price, implying that the existence of the pre-sales system improves market efficiency; and 2) housing supply from the pre-sales market responds to the housing market surpluses/shortages.