Mortgage down-payment and welfare in a life-cycle model
AbstractThe paper presents a standard incomplete markets life-cycle model with housing that is calibrated to the Polish economy. The model is used to analyze the effects of changes in the minimum down-payment restriction on welfare. Our analysis shows that tougher credit conditions have a significant impact on the level of household debt, the ownership ratio and the time of first house purchase. However, assuming well functioning rental market the welfare costs are not sizable.
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Bibliographic InfoArticle provided by National Bank of Poland, Economic Institute in its journal Bank i Kredyt.
Volume (Year): 43 (2012)
Issue (Month): 4 ()
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life-cycle model; housing; mortgage down-payment; welfare;
Find related papers by JEL classification:
- E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
- E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
- R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
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- Rubaszek, Michał & Serwa, Dobromil, 2012.
"Determinants of credit to households in a life-cycle model,"
Working Paper Series
1420, European Central Bank.
- Michal Rubaszek & Dobromil Serwa, 2011. "Determinants of credit to households in a life-cycle model," National Bank of Poland Working Papers 92, National Bank of Poland, Economic Institute.
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