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Macroeconomic determinants of real estate prices. Evidences and lessons from European countries


  • Ion Anghel
  • Ciprian Sipos
  • Marilena Mironiuc
  • Elena Ionascu


Our research investigate the dynamics of European real estate markets from the perspective of the house price index (HPI) in correlation with relevant economic variables, such as: economic growth, household disposable income, residential loans, interest rate on new residential loans, housing stock, and property tax. Thus, we provide a new approach to analyse the real estate market dynamics with practical and direct implications on all three market participants – the debtor, the creditor and the state, in order to ensure financial stability. The results of panel analysis revealed the very strong statistical influence of ratio “nominal house price to disposal income of households” but a weak statistical influence of interest rate and level of property taxes on the price index. This evidences generates discussions about the efficiency of tax and interest rate policies in some countries. Moreover, mortgage credit remains one of the major contributors to real economic growth, accounting for 47% of EU GDP. It facilitates the access of population to real estate properties and, thus, indirectly generates tax revenues in state budgets.

Suggested Citation

  • Ion Anghel & Ciprian Sipos & Marilena Mironiuc & Elena Ionascu, 2018. "Macroeconomic determinants of real estate prices. Evidences and lessons from European countries," ERES eres2018_189, European Real Estate Society (ERES).
  • Handle: RePEc:arz:wpaper:eres2018_189

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    Housing Prices; housing supply and markets; Interest Rate; Macroeconomic Determinants; value-based taxation;

    JEL classification:

    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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