IDEAS home Printed from https://ideas.repec.org/a/eee/eecrev/v182y2026ics0014292125002612.html

Institutional housing investors and the Great Recession

Author

Listed:
  • Oosthuizen, Dick

Abstract

Before the Great Recession, residential institutional investors predominantly bought and rented out condos, but then they increased their market share of rental houses from 15 percent in 2001 to 27 percent in 2018. Along with this change, rental survey data show that the annual house operating-cost premium of institutional investors relative to homeowners fell from 44 percent in 2001 to 28 percent in 2015. To measure how these reduced costs affected the housing bust of 2007–2011, I build a heterogeneous agent model of the housing market featuring corporate investors and two types of dwellings: condos and houses. A transition experiment intended to replicate the Great Recession yields three results. First, house prices would have fallen by 1.6 percentage points more without the corporate-cost reduction. Second, the corporate-cost reduction can explain the fall in the homeownership rate. Third, the cost reduction produced a welfare gain of 0.4 percent for homeowners and 0.6 percent for individual investors.

Suggested Citation

  • Oosthuizen, Dick, 2026. "Institutional housing investors and the Great Recession," European Economic Review, Elsevier, vol. 182(C).
    • Handle: RePEc:eee:eecrev:v:182:y:2026:i:c:s0014292125002612
    DOI: 10.1016/j.euroecorev.2025.105211
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0014292125002612
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.euroecorev.2025.105211?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eecrev:v:182:y:2026:i:c:s0014292125002612. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eer .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.