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The Housing Market in Colombia: Socioeconomic and Financial Determinants

Author

Listed:
  • Sergio Clavijo
  • Michel Janna
  • Santiago Munoz

Abstract

This document provides an overview of the housing system in Colombia, exploring its socioeconomic and financial determinants and offering recommendations to improve the collection of basic data on the construction sector, household socioeconomic conditions, and mortgage markets. The paper also estimates a simultaneous econometric model for the country`s housing market using quarterly data over the period 1991-2004. On the demand side, we find that the area of approved licenses is highly elastic to households` disposable income, new housing prices and real interest rates on mortgage credit. On the supply side, we find high input-cost elasticity and a moderate response to wealth effects. These results prove to be robust to different proxies and diverse estimation procedures.

Suggested Citation

  • Sergio Clavijo & Michel Janna & Santiago Munoz, 2005. "The Housing Market in Colombia: Socioeconomic and Financial Determinants," Research Department Publications 4389, Inter-American Development Bank, Research Department.
    • Handle: RePEc:idb:wpaper:4389
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    References listed on IDEAS

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    1. Mauricio Cardenas & Alejandro Badel, 2003. "La crisis de financiamiento hipotecario en Colombia: Causas y consecuencias," Research Department Publications 4355, Inter-American Development Bank, Research Department.
    2. Herrera, Santiago & Perry, Guillermo, 2001. "Tropical bubbles : asset prices in Latin America, 1980-2001," Policy Research Working Paper Series 2724, The World Bank.
    3. Karl E. Case, 2000. "Real Estate and Macroeconomy," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 31(2), pages 119-162.
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    6. Arcelus, Francisco & Meltzer, Allan H, 1973. "The Markets for Housing and Housing Services: Reply," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 5(4), pages 973-978, November.
    7. Mauricio Cárdenas & Alejandro Badel F., 2003. "La crisis de financiamiento hipotecario en Colombia: causas y consecuencias," Coyuntura Económica, Fedesarrollo.
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    9. Sergio Clavijo, 2002. "Política monetaria y cambiaria en Colombia: progresos y desafíos (1991-2002)," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 20(41-42), pages 87-142, June.
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    Cited by:

    1. María Angélica Arbeláez & Roberto Steiner & Alejandro Becerra & Daniel Wills, 2011. "Housing tenure and housing demand in Colombia," Working Papers Series. Documentos de Trabajo 9067, Fedesarrollo.
    2. Natalia Garabato & Magdalena Ramada-Sarasola, 2011. "Housing Markets in Uruguay: Determinants of Housing Demand and its Interaction with Public Policies," Research Department Publications 4737, Inter-American Development Bank, Research Department.

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