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An Analysis of Housing Wealth Effect from Micro Data

Chungyu Park 1 Young Lee 2

1국토연구원
2한양대학교

Accredited

ABSTRACT

The theme of the study is the housing wealth effect. The study uses micro data which examine household consumption and assets as well as demographic characteristics of households in detail. The summary of the findings and the implications of the study are the following. First, the consumption elasticity of housing assets is estimated to be 0.05. The consumption elasticity of housing assets is much higher than other assets. Second, the consumption elasticity of assets for the group that is more than 60 years old is higher than others, that is, a different result from American’s researches. This result shows that households maintain possession of their housing property even though their incomes decrease because of their retirements in Korea. Third, the consumption elasticity of housing assets for households living in apartments is higher than others. Compared to other types of housing, it demonstrates good liquidity and mobility of apartments and apartment owners in Korea. Fourth, households having low ratio of debt to assets have high consumption elasticity of assets because they are restricted in their consumption by a lot of debt.

Citation status

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