Bubble, bubble, toil, and trouble
The rapid rise of real estate prices in recent years has led to fears of a housing price bubble. But, to determine whether there has been a bubble–and whether the bubble is bursting–one needs to know what home prices “should” be. The authors estimate a simple model of home prices and find that prices were, on average, above their predicted levels during 2000–06. However, this result does not hold true uniformly across the country. To the extent that prices were overheating, this was happening largely in markets that have traditionally exhibited volatile prices
Volume (Year): (2007)
Issue (Month): Q I ()
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- Todd Sinai & Nicholas S. Souleles, 2005.
"Owner-occupied housing as a hedge against rent risk,"
05-10, Federal Reserve Bank of Philadelphia.
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- Richard J. Rosen, 2005. "Explaining recent changes in home prices," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Jul.
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