Affiliation:
1. University of Cambridge, UK
2. ECORYS, The Netherlands
Abstract
House prices in Israel have registered unprecedented growth rates in the last
few years. At first glance, these hikes could be explained by the evolution
of fundamentals such strong population growth and favourable macroeconomic
conditions, i.e. low interest rates. However, further investigation is needed
in order to explore whether there is a misalignment between house prices and
their fundamentals. Firstly, this paper investigates the role of construction
costs in the evolution of house prices. Secondly, this contribution
decomposes the ?price-to-rent? ratio into fundamentals, frictions and bubble
episodes for a better understanding of the recent trends of the market.
Publisher
National Library of Serbia
Subject
General Economics, Econometrics and Finance
Cited by
2 articles.
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