IDEAS home Printed from https://ideas.repec.org/p/cbi/ecolet/02-el-15.html
   My bibliography  Save this paper

House price volatility: The role of different buyer types

Author

Listed:
  • Coates, Dermot

    (Central Bank of Ireland)

  • Lydon, Reamonn

    (Central Bank of Ireland)

  • McCarthy, Yvonne

    (Central Bank of Ireland)

Abstract

This Economic Letter examines the link between house price dynamics in Ireland during the recent housing boom and the composition of buyers in the market. The analysis provides information on the relative riskiness of different buyer types, a topic that has increased in importance with the recent Central Bank of Ireland proposals to cap loan-to-value and loan-to-income ratios for new mortgage borrowings. The analysis points to an association between periods of strong house price growth and the changing composition of Irish property purchasers, and in particular, the rise in the BTL segment.

Suggested Citation

  • Coates, Dermot & Lydon, Reamonn & McCarthy, Yvonne, 2015. "House price volatility: The role of different buyer types," Economic Letters 02/EL/15, Central Bank of Ireland.
    • Handle: RePEc:cbi:ecolet:02/el/15
    as

    Download full text from publisher

    File URL: https://centralbank.ie/docs/default-source/publications/economic-letters/economic-letter---vol-2015-no-2.pdf?sfvrsn=10
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Lydon, Reamonn & O'Hanlon, Niall, 2012. "Housing Equity Withdrawal, Property Bubbles and Consumption," Research Technical Papers 05/RT/12, Central Bank of Ireland.
    2. Kennedy, Gerard & McQuinn, Kieran, 2012. "Why are Irish house prices still falling?," Economic Letters 05/EL/12, Central Bank of Ireland.
    3. Jeremy C. Stein, 1995. "Prices and Trading Volume in the Housing Market: A Model with Down-Payment Effects," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(2), pages 379-406.
    4. François Ortalo-Magné & Sven Rady, 2006. "Housing Market Dynamics: On the Contribution of Income Shocks and Credit Constraints ," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 73(2), pages 459-485.
    5. Andrew Benito, 2006. "How does the down-payment constraint affect the UK housing market?," Bank of England working papers 294, Bank of England.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Lydon, Reamonn & McIndoe-Calder, Tara, 2017. "The great Irish (de)leveraging 2005-14," Working Paper Series 2062, European Central Bank.
    2. Kelly, Jane & Le Blanc, Julia & Lydon, Reamonn, 2018. "Pockets of risk in European Housing Markets: then and now," Research Technical Papers 12/RT/18, Central Bank of Ireland.
    3. International Monetary Fund, 2016. "Ireland: Financial Sector Assessment Program: Technical Note-Macroprudential Policy Framework," IMF Staff Country Reports 2016/316, International Monetary Fund.
    4. Mark Cassidy & Niamh Hallissey, 2016. "The Introduction of Macroprudential Measures for the Irish Mortgage Market," The Economic and Social Review, Economic and Social Studies, vol. 47(2), pages 271-297.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. David Gray & Caroline Elliott, 2015. "Are prices of New dwellings different? A spectral analysis of UK property vintages," Cogent Economics & Finance, Taylor & Francis Journals, vol. 3(1), pages 993860-9938, December.
    2. Philippe Bracke & Silvana Tenreyro, 2021. "History Dependence in the Housing Market," American Economic Journal: Macroeconomics, American Economic Association, vol. 13(2), pages 420-443, April.
    3. de Wit, Erik R. & Englund, Peter & Francke, Marc K., 2013. "Price and transaction volume in the Dutch housing market," Regional Science and Urban Economics, Elsevier, vol. 43(2), pages 220-241.
    4. Andrew Benito, 2006. "How does the down-payment constraint affect the UK housing market?," Bank of England working papers 294, Bank of England.
    5. Carlos Garriga & Aaron Hedlund, 2019. "Crises in the Housing Market: Causes, Consequences, and Policy Lessons," Working Papers 2019-33, Federal Reserve Bank of St. Louis.
    6. Jacob L. Vigdor, 2004. "Liquidity Constraints and Housing Prices: Theory and Evidence from the VA Mortgage," NBER Working Papers 10611, National Bureau of Economic Research, Inc.
    7. Roberto Brunetti & Carl Gaigné & Fabien Moizeau, 2023. "Credit Market Imperfections, Urban Land Rents and the Henry George Theorem," Revue économique, Presses de Sciences-Po, vol. 74(5), pages 681-703.
    8. L. Rachel Ngai & Silvana Tenreyro, 2014. "Hot and Cold Seasons in the Housing Market," American Economic Review, American Economic Association, vol. 104(12), pages 3991-4026, December.
    9. Suarez, Javier & Ceron, Jose A., 2006. "Hot and Cold Housing Markets: International Evidence," CEPR Discussion Papers 5411, C.E.P.R. Discussion Papers.
    10. Luc Laeven & Alexander Popov, 2017. "Waking Up from the American Dream: On the Experience of Young Americans during the Housing Boom of the 2000s," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 49(5), pages 861-895, August.
    11. Mi Diao & Yi Fan & Tien Foo Sing, 2018. "Demand restrictions; government interventions; resale public housing market; private housing market; housing wealth," ERES eres2018_32, European Real Estate Society (ERES).
    12. Oikarinen, Elias, 2009. "Interaction between housing prices and household borrowing: The Finnish case," Journal of Banking & Finance, Elsevier, vol. 33(4), pages 747-756, April.
    13. repec:bof:bofrdp:urn:nbn:fi:bof-201510061415 is not listed on IDEAS
    14. Plamen Nenov, 2013. "Regional Mismatch and Labor Reallocation in an Equilibrium Model of Migration," 2013 Meeting Papers 565, Society for Economic Dynamics.
    15. Nan-Kuang Chen & Charles Leung, 2008. "Asset Price Spillover, Collateral and Crises: with an Application to Property Market Policy," The Journal of Real Estate Finance and Economics, Springer, vol. 37(4), pages 351-385, November.
    16. Dong, Ding & Liu, Zheng & Wang, Pengfei & Zha, Tao, 2022. "A theory of housing demand shocks," Journal of Economic Theory, Elsevier, vol. 203(C).
    17. Eric Smith & Zoe Xie & Lei Fang, 2022. "The Short and the Long of It: Stock-Flow Matching in the US Housing Market," CESifo Working Paper Series 10035, CESifo.
    18. Eerola, Essi & Määttänen, Niku, 2013. "Matching in the housing market with risk aversion and savings," ETLA Working Papers 3, The Research Institute of the Finnish Economy.
    19. Eric Levin & Gwilym Pryce, 2011. "A Disequilibrium Model of the Market for Houses: Implicit Selling Time as a Signal of Optimal Holding Periods and Buyer Valuation," Urban Studies, Urban Studies Journal Limited, vol. 48(11), pages 2249-2263, August.
    20. Gene Amromin & Jennifer Huang & Clemens Sialm & Edward Zhong, 2018. "Complex Mortgages [Why don’t lenders renegotiate more home mortgages? Redefaults, self-cures, and securitization]," Review of Finance, European Finance Association, vol. 22(6), pages 1975-2007.
    21. Carozzi, Felipe & Hilber, Christian A.L. & Yu, Xiaolun, 2024. "On the economic impacts of mortgage credit expansion policies: Evidence from help to buy," Journal of Urban Economics, Elsevier, vol. 139(C).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:cbi:ecolet:02/el/15. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Fiona Farrelly (email available below). General contact details of provider: https://edirc.repec.org/data/cbigvie.html .

    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.