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The Bank of Japan as a Real Estate Tycoon: Large-Scale REIT Purchases

Author

Listed:
  • Takahiro Hattori

    (Hitotsubashi University)

  • Jiro Yoshida

    (The Pennsylvania State University and the University of Tokyo)

Abstract

This is the first study analyzing the Bank of Japan’s purchases of real estate investment trusts (REITs) that started in 2010 as part of enhanced unconventional monetary policy. The Bank purchases REIT shares after observing a significantly negative return over the previous night and during the morning market. The Bank continues purchases daily until the overnight and morning REIT returns become positive. This counter-cyclical behavior is consistent with the objective of decreasing risk premia and stimulating spending. Our study sheds light on the unique program of a central bank’s equity purchases.

Suggested Citation

  • Takahiro Hattori & Jiro Yoshida, 2020. "The Bank of Japan as a Real Estate Tycoon: Large-Scale REIT Purchases," GRU Working Paper Series GRU_2020_003, City University of Hong Kong, Department of Economics and Finance, Global Research Unit.
    • Handle: RePEc:cth:wpaper:gru_2020_003
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    File URL: https://www.cb.cityu.edu.hk/ef/doc/GRU/WPS/GRU%232020-003%20Yoshida.pdf
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    Cited by:

    1. Tang, Edward Chi Ho & Leung, Charles Ka Yui, 2024. "Icing on the cake: Can the Top-Floor Units serve as a status good and an investment simultaneously?," MPRA Paper 121937, University Library of Munich, Germany.
    2. Hattori, Takahiro & Yoshida, Jiro, 2023. "The impact of Bank of Japan’s exchange-traded fund purchases," Journal of Financial Stability, Elsevier, vol. 65(C).

    More about this item

    Keywords

    large-scale asset purchases (LSAP); quantitative easing (QE); central banking; real estate investment trust; unconventional monetary policy;
    All these keywords.

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets

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