IDEAS home Printed from https://ideas.repec.org/a/taf/eurjhp/v4y2004i1p19-56.html
   My bibliography  Save this article

The evolution and the relationship of house prices and rents in Barcelona, 1970–2002

Author

Listed:
  • Mercè Carreras-i-Solanas
  • Oscar Mascarilla-i-Miró
  • Yuri Yegorov

Abstract

The aim of the paper is to analyse the evolution of house prices in Barcelona using a theoretical and empirical framework. Housing is a durable good which involves both consumption and investment components. We develop a model that explains the long-run equilibrium relationship between prices to buy and to rent (time of rent to buy) as well as dynamics of deviations from this equilibrium. Empirical studies of the housing market show significant low-frequency fluctuations over time. We test the model with the data for Barcelona for several periods between 1970 and 2002. The general evolution of both house prices and rental price exhibits the pattern of long wave, but the ratio of these prices is not constant over time. We argue that the periods of relatively high housing prices with respect to rental prices correspond to additional demand for housing coming from investors. The conclusion of the paper includes a detection of complex non-random dynamics of the prices for housing in Barcelona and explanation of this effect with the proposed theoretical models.

Suggested Citation

  • Mercè Carreras-i-Solanas & Oscar Mascarilla-i-Miró & Yuri Yegorov, 2004. "The evolution and the relationship of house prices and rents in Barcelona, 1970–2002," European Journal of Housing Policy, Taylor and Francis Journals, vol. 4(1), pages 19-56.
    • Handle: RePEc:taf:eurjhp:v:4:y:2004:i:1:p:19-56
    DOI: 10.1080/1461671042000215442
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/1461671042000215442
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/1461671042000215442?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 search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Lee, Hung-Wei & Lin, Che-Chun & Tsai, I-Chun, 2023. "Another application of call options: Explaining the divergence between the housing market and the rental market," Finance Research Letters, Elsevier, vol. 53(C).
    2. Eddie Chi-man Hui & Xian Zheng, 2012. "The dynamic correlation and volatility of real estate price and rental: an application of MSV model," Applied Economics, Taylor & Francis Journals, vol. 44(23), pages 2985-2995, August.
    3. Arrazola, María & de Hevia, José & Romero, Desiderio & Sanz-Sanz, José Félix, 2014. "Determinants of the Spanish housing market over three decades and three booms: Long run supply and demand elasticities," Working Paper Series 18852, Victoria University of Wellington, Chair in Public Finance.
    4. Yuri Yegorov, 2011. "Migration as Driving Force for the Dynamics of Housing Rent," ERSA conference papers ersa11p49, European Regional Science Association.

    More about this item

    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:taf:eurjhp:v:4:y:2004:i:1:p:19-56. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/REUJ20 .

    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.