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The Effects of Macroeconomic Fundamentals on Housing Market: Considering Structural Breaks

BYOUNGKY CHANG 1 심성훈 2

1부경대학교
2경주대학교

Accredited

ABSTRACT

The purpose of this study is to examine the relationship between housing price and the other economic variables in consideration of structural breaks during 1986-2004. To this end, data analysis was conducted through the methods such as Zivot and Andrews'(1992) unit root test and Gregory and Hansen's(1996a, b) cointegration test. We found the following empirical results. The relationship between housing price and interest rate has changed from positive to negative after structural break. In addition, the effect of economic growth on the housing price increased. This suggests that the market fundamentals play more important roles on determining of housing price in the long run. Further this finding gives some policy implications for the housing market. That is, the long-term housing policy to stabilize housing markets should be considered in accordance with the macroeconomic policy (including interest rate) as well as tax policy.

Citation status

* References for papers published after 2022 are currently being built.