Risk and return in the single-family housing market
The tradeoff between risk and return in equity markets is well established. This paper examines the existence of the same tradeoff in the single-family housing market. For home buyers, who constitute about two-thirds of U.S. households, the choice about how much housing and which house to buy is a joint consumption/investment decision. Does this consumption/investment link negate the risk/return tradeoff within the single-family hosuing market? Theory suggests the link still holds. This paper supplies empirical evidence in support of that theoretical result.
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References listed on IDEAS
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- Roger G. Ibbotson & Laurence B. Siegel, 1984. "Real Estate Returns: A Comparison with Other Investments," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 12(3), pages 219-242.
- Dennis R. Capozza & Gregory M. Schwann, 1989. "The Asset Approach to Pricing Urban Land: Empirical Evidence," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 17(2), pages 161-174.
- Case, Karl E & Shiller, Robert J, 1989.
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- Karl E. Case & Robert J. Shiller, 1988. "The Efficiency of the Market for Single-Family Homes," NBER Working Papers 2506, National Bureau of Economic Research, Inc.
- Berkovec, James, 1989. "A General Equilibrium Model of Housing Consumption and Investment," The Journal of Real Estate Finance and Economics, Springer, vol. 2(3), pages 157-172, September.
- Crone, Theodore M. & Voith, Richard P., 1992. "Estimating house price appreciation: A comparison of methods," Journal of Housing Economics, Elsevier, vol. 2(4), pages 324-338, December.
- Theodore M. Crone & Richard Voith, 1992. "Estimating house price appreciation: a comparison of methods," Working Papers 92-21, Federal Reserve Bank of Philadelphia.
- Karl E. Case, 1989. "The Asset Approach to Pricing Urban Land: Empirical Evidence," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 17(2), pages 175-176.
- Gat, Daniel, 1994. "Risk and Return in Residential Spatial Markets: An Empiric and Theoretic Model," The Journal of Real Estate Finance and Economics, Springer, vol. 9(1), pages 51-67, July.
- William N. Goetzmann & Roger G. Ibbotson, 1990. "The Performance Of Real Estate As An Asset Class," Journal of Applied Corporate Finance, Morgan Stanley, vol. 3(1), pages 65-76. Full references (including those not matched with items on IDEAS)
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