@article{ART002538797},
author={Hyun-Tak Lee},
title={A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios},
journal={The Korea Spatial Planning Review},
issn={1229-8638},
year={2019},
volume={103},
pages={41-60},
doi={10.15793/kspr.2019.103..003}
TY - JOUR
AU - Hyun-Tak Lee
TI - A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios
JO - The Korea Spatial Planning Review
PY - 2019
VL - 103
IS - null
PB - 국토연구원
SP - 41
EP - 60
SN - 1229-8638
AB - This paper develops a new present-value framework in rental housing markets in Korea. To implement the model precisely, I use Seoul apartment data and devise a log price-rent ratio that is a linear combination of home prices, Jeonse, monthly deposits, and Jeonse-to-rent conversion rates. I show that the ratios strongly predict one-period-ahead conversion rates, not the long-term ones. This finding points out that the conversion rate is so transient that its shock could hardly cumulate over time, thereby little affecting the home prices in the long run. In contrast, I find that the ratios strongly forecast long-term deposit growth, not its short-term growth. The rationale behind this is that its shock is so persistent as to build up over time, which affects the home prices significantly in the end. The implication is that we should monitor an irrational swing of the deposit behavior to attenuate the excess volatility of the apartment lease market.
KW - Present-value Models;Variance Decomposition;Apartment Lease Market;Jeonse-to-rent Conversion Ratio;Market Stabilization
DO - 10.15793/kspr.2019.103..003
ER -
Hyun-Tak Lee. (2019). A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios. The Korea Spatial Planning Review, 103, 41-60.
Hyun-Tak Lee. 2019, "A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios", The Korea Spatial Planning Review, vol.103, pp.41-60. Available from: doi:10.15793/kspr.2019.103..003
Hyun-Tak Lee "A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios" The Korea Spatial Planning Review 103 pp.41-60 (2019) : 41.
Hyun-Tak Lee. A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios. 2019; 103 41-60. Available from: doi:10.15793/kspr.2019.103..003
Hyun-Tak Lee. "A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios" The Korea Spatial Planning Review 103(2019) : 41-60.doi: 10.15793/kspr.2019.103..003
Hyun-Tak Lee. A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios. The Korea Spatial Planning Review, 103, 41-60. doi: 10.15793/kspr.2019.103..003
Hyun-Tak Lee. A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios. The Korea Spatial Planning Review. 2019; 103 41-60. doi: 10.15793/kspr.2019.103..003
Hyun-Tak Lee. A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios. 2019; 103 41-60. Available from: doi:10.15793/kspr.2019.103..003
Hyun-Tak Lee. "A Study on Dynamic House-Rent Relationship through Jeonse-to-Rent Ratios" The Korea Spatial Planning Review 103(2019) : 41-60.doi: 10.15793/kspr.2019.103..003
