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Income Migration and Home Price Trajectories in the United States

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  • Samuel M. Otterstrom

    () (Brigham Young University)

Abstract

This paper models one facet of the relationship between housing market price shifts and income migration among U.S. regions: how income migration relates to regional housing price clusters. The tremendous negative slide in national housing prices from 2006 to 2012 had an uneven spatial distribution. These differences are explored within the context of net income and net population migration (movement of money with people). Median housing prices for urban areas from 2005 to 2010 and IRS county-to-county migration data are used to compare income migration among urban clusters of similar housing price trends. Selective migrations of people and income in and out of these housing clusters have either exacerbated the housing bust or softened its decline. Income effectiveness, or the gain or loss of money caused by migration, is a helpful measure that can be used to help predict future housing price movements.

Suggested Citation

  • Samuel M. Otterstrom, 2015. "Income Migration and Home Price Trajectories in the United States," International Real Estate Review, Asian Real Estate Society, vol. 18(2), pages 277-302.
  • Handle: RePEc:ire:issued:v:18:n:02:2015:p:277-302
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    References listed on IDEAS

    as
    1. Albert Saiz, 2010. "The Geographic Determinants of Housing Supply," The Quarterly Journal of Economics, Oxford University Press, vol. 125(3), pages 1253-1296.
    2. Gilad Aharonovitz, 2011. "Knowledge-based spatial differences in economic activity, job related migration and housing related migration," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 46(1), pages 159-188, February.
    3. Kari Hämäläinen & Petri Böckerman, 2004. "Regional Labor Market Dynamics, Housing, and Migration," Journal of Regional Science, Wiley Blackwell, vol. 44(3), pages 543-568, August.
    4. Andrew Coleman & John Landon-Lane, 2007. "Housing Markets and Migration in New Zealand, 1962-2006," Reserve Bank of New Zealand Discussion Paper Series DP2007/12, Reserve Bank of New Zealand.
    5. Modestino, Alicia Sasser & Dennett, Julia, 2013. "Are American homeowners locked into their houses? The impact of housing market conditions on state-to-state migration," Regional Science and Urban Economics, Elsevier, vol. 43(2), pages 322-337.
    6. Saks, Raven E., 2008. "Job creation and housing construction: Constraints on metropolitan area employment growth," Journal of Urban Economics, Elsevier, vol. 64(1), pages 178-195, July.
    7. Edward L. Glaeser & Joseph Gyourko & Raven E. Saks, 2006. "Urban growth and housing supply," Journal of Economic Geography, Oxford University Press, vol. 6(1), pages 71-89, January.
    8. Frame, David E., 2004. "Equilibrium and migration in dynamic models of housing markets," Journal of Urban Economics, Elsevier, vol. 55(1), pages 93-112, January.
    9. J. Phillips & E. Goodstein, 2000. "Growth management and housing prices: the case of Portland, Oregon," Contemporary Economic Policy, Western Economic Association International, vol. 18(3), pages 334-344, July.
    10. Min Hwang & John M. Quigley, 2006. "Economic Fundamentals In Local Housing Markets: Evidence From U.S. Metropolitan Regions," Journal of Regional Science, Wiley Blackwell, vol. 46(3), pages 425-453, August.
    11. Jeanty, P. Wilner & Partridge, Mark & Irwin, Elena, 2010. "Estimation of a spatial simultaneous equation model of population migration and housing price dynamics," Regional Science and Urban Economics, Elsevier, vol. 40(5), pages 343-352, September.
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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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