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Housing Markets in Uruguay: Determinants of Housing Demand and its Interaction with Public Policies

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  • Natalia Garabato
  • Magdalena Ramada-Sarasola

Abstract

This paper analyzes the determinants of housing demand for Uruguay and the extent to which housing policies have an impact on their target population. The paper first analyzes the determinants of housing demand, following an approach based on Rosen’s (1974) two-step procedure consisting of fitting a hedonic price regression in 34 different geographical units (or markets) to estimate a housing demand function. The determinants of formality and ownership choices were examined using a multinomial logit framework. Determinants of these choices include both household demographic attributes and access to and use of public housing programs and other social programs. Policy recommendations are offered on the basis of the finding that a price and income-inelastic formal housing market greatly contrasts with a rather price and income-elastic informal housing market.

Suggested Citation

  • 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.
    • Handle: RePEc:idb:wpaper:4737
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    References listed on IDEAS

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    1. repec:idb:brikps:46158 is not listed on IDEAS
    2. Edward E. Leamer, 2007. "Housing is the business cycle," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 149-233.
    3. 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.
    4. Quigley, John M., 2006. "Urban Economics," Berkeley Program on Housing and Urban Policy, Working Paper Series qt0jr0p2tk, Berkeley Program on Housing and Urban Policy.
    5. Inter-American Development Bank (IDB), 2004. "Reforming Latin American Housing Markets: A Guide for Policy Analysis," IDB Publications (Books), Inter-American Development Bank, number 46158, February.
    6. Ermisch, J. F. & Findlay, J. & Gibb, K., 1996. "The Price Elasticity of Housing Demand in Britain: Issues of Sample Selection," Journal of Housing Economics, Elsevier, vol. 5(1), pages 64-86, March.
    7. Stephen Malpezzi, 1999. "The Regulation of Urban Development: Lessons From International Experience," Wisconsin-Madison CULER working papers 99-07, University of Wisconsin Center for Urban Land Economic Research.
    8. Inter American Development Bank, 2004. "Reforming Latin American Housing Markets: A Guide for Policy Analysis," IDB Publications (Books), Inter-American Development Bank, number 312, November.
    9. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    10. Mayo, Stephen K., 1981. "Theory and estimation in the economics of housing demand," Journal of Urban Economics, Elsevier, vol. 10(1), pages 95-116, July.
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    Cited by:

    1. Felipe Berrutti, 2016. "Subsidios a la oferta y decisiones de localización: El caso de la Ley de Vivienda de Interés Social," Documentos de Investigación Estudiantil (students working papers) 16-02, Instituto de Economía - IECON.
    2. Natalia Garabato & Magdalena Ramada-Sarasola, 2011. "Are Uruguayan Housing Policies Reaching the Poor? An Assessment of Housing Deficit, Housing Informality and Usage of Housing Programs in Uruguay," Research Department Publications 4752, Inter-American Development Bank, Research Department.

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    More about this item

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • R28 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Government Policy
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy

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