@article{ART002177545},
author={Heegab Choi},
title={Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction},
journal={Korea Real Estate Review},
issn={2092-5395},
year={2016},
volume={26},
number={4},
pages={25-39}
TY - JOUR
AU - Heegab Choi
TI - Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction
JO - Korea Real Estate Review
PY - 2016
VL - 26
IS - 4
PB - korea real estate research institute
SP - 25
EP - 39
SN - 2092-5395
AB - This paper studies the role of fluctuations in the aggregate consumption-wealth ratio for predicting housing returns in Korea. This is because, following Lettau and Ludvigson(2001), the consumer’s budget constraint implies that the residuals of the trend relationship among consumption and aggregate wealth should predict housing returns. We use quarterly data (1987.2Q~2012.2Q) and find that fluctuations in the consumption-wealth ratio in Korea are predictors of real and excess housing returns. In most models, financial and housing assets are found to be seen as complements in the short-run. That is, when Korean household expects future housing returns to be higher, they will temporarily allow consumption to rise. This result is consistent with the result from most OECD countries including Japan.
KW - budget constraint;housing price;consumption-wealth ratio
DO -
UR -
ER -
Heegab Choi. (2016). Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction. Korea Real Estate Review, 26(4), 25-39.
Heegab Choi. 2016, "Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction", Korea Real Estate Review, vol.26, no.4 pp.25-39.
Heegab Choi "Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction" Korea Real Estate Review 26.4 pp.25-39 (2016) : 25.
Heegab Choi. Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction. 2016; 26(4), 25-39.
Heegab Choi. "Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction" Korea Real Estate Review 26, no.4 (2016) : 25-39.
Heegab Choi. Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction. Korea Real Estate Review, 26(4), 25-39.
Heegab Choi. Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction. Korea Real Estate Review. 2016; 26(4) 25-39.
Heegab Choi. Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction. 2016; 26(4), 25-39.
Heegab Choi. "Consumption-Wealth Ratio and Housing Prices in Korea: Complementarity and Price Prediction" Korea Real Estate Review 26, no.4 (2016) : 25-39.
