Exploding House Prices in Urban Housing Markets: Explanations and Policy Solutions for the Netherlands

In the life cycle model of consumption and saving, homeownership is an important vehicle for horizontal redistribution. Households accumulate wealth in owner-occupied housing during working lives before benefiting from imputed rent streams in retirement. But in some countries housing wealth’s welfare role has broadened as owners increasingly use flexible mortgages to smooth consumption during working lives. One consequence is higher outstanding mortgages later in life, a burden exacerbated by high real house prices that compel home buyers to demand mortgages that are a growing multiple of their incomes. We investigate whether these developments are prompting longer working lives, an idea that is especially relevant in countries offering relatively low government pensions. Australia is one such country. We use the 2001–2017 panels of the Household, Income and Labour Dynamics in Australia Survey to estimate hazard models of exits from the Australian labour force as workers approach pensionable age. We find that those with high outstanding mortgage debts are more likely to postpone retirement, as are those with relatively low amounts of private pension wealth. These results are stronger in urban housing markets, and especially among males.

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Amsterdam house price ripple effects in The Netherlands

Journal of European Real Estate Research ◽

10.1108/jerer-11-2016-0041 ◽

2017 ◽

Vol 10 (3) ◽

pp. 331-345 ◽

Cited By ~ 9

Author(s):

Alfred Larm Teye ◽

Michel Knoppel ◽

Jan de Haan ◽

Marja G. Elsinga

Keyword(s):

The Netherlands ◽

Granger Causality ◽

House Prices ◽

House Price ◽

Housing Markets ◽

Wealth Effects ◽

Ripple Effect ◽

Content Type ◽

Long Run ◽

Lag Effect

Purpose This paper aims to examine the existence of the ripple effect from Amsterdam to the housing markets of other regions in The Netherlands. It identifies which regional housing markets are influenced by house price movements in Amsterdam. Design/methodology/approach The paper considers the ripple effect as a lead-lag effect and a long-run convergence between the Amsterdam and regional house prices. Using the real house prices for second-hand owner-occupied dwellings from 1995q1 to 2016q2, the paper adopts the Toda–Yamamoto Granger Causality approach to study the lead-lag effects. It uses the autoregressive distributed lags (ARDL)-Bounds cointegration techniques to examine the long-run convergence between the regional and the Amsterdam house prices. The paper controls for house price fundamentals to eliminate possible confounding effects of common shocks. Findings The cumulative evidence suggests that Amsterdam house prices have influence on (or ripple to) all the Dutch regions, except one. In particular, the Granger Causality test concludes that a lead-lag effect of house prices exists from Amsterdam to all the regions, apart from Zeeland. The cointegration test shows evidence of a long-convergence between Amsterdam house prices and six regions: Friesland, Groningen, Limburg, Overijssel, Utrecht and Zuid-Holland. Research limitations/implications The paper adopts an econometric approach to examine the Amsterdam ripple effect. More sophisticated economic models that consider the asymmetric properties of house prices and the patterns of interregional socio-economic activities into the modelling approach are recommended for further investigation. Originality/value This paper focuses on The Netherlands for which the ripple effect has not yet been researched to the authors’ knowledge. Given the substantial wealth effects associated with house price changes that may shape economic activity through consumption, evidence for ripples may be helpful to policy makers for uncovering trends that have implications for the entire economy. Moreover, the analysis controls for common house price fundamentals which most previous papers ignored.

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Urban Housing Markets

10.3138/9781442632318 ◽

1978 ◽

Cited By ~ 2

Keyword(s):

Housing Markets ◽

Urban Housing

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The role and significance of planning in the determination of house prices in Australia: Recent policy debates

Environment and Planning A Economy and Space ◽

10.1177/0308518x21988942 ◽

2021 ◽

pp. 0308518X2198894

Author(s):

Peter Phibbs ◽

Nicole Gurran

Keyword(s):

Land Use ◽

Housing Market ◽

Land Use Planning ◽

House Prices ◽

Housing Prices ◽

House Price ◽

Evidence Base ◽

Urban Housing ◽

Price Inflation ◽

Depth Analysis

On the world stage, Australian cities have been punching above their weight in global indexes of housing prices, sparking heated debates about the causes of and remedies for, sustained house price inflation. This paper examines the evidence base underpinning such debates, and the policy claims made by key commentators and stakeholders. With reference to the wider context of Australia’s housing market over a 20 year period, as well as an in depth analysis of a research paper by Australia’s central Reserve Bank, we show how economic theories commonly position land use planning as a primary driver of new supply constraints but overlook other explanations for housing market behavior. In doing so, we offer an alternative understanding of urban housing markets and land use planning interventions as a basis for more effective policy intervention in Australian and other world cities.

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Social Accounts and Planning for Changes in Urban Housing Markets

Environment and Planning A Economy and Space ◽

10.1068/a100247 ◽

1978 ◽

Vol 10 (3) ◽

pp. 247-266 ◽

Cited By ~ 7

Author(s):

J W Byler ◽

S Gale

Keyword(s):

Housing Market ◽

Stochastic Models ◽

Housing Markets ◽

Urban Housing ◽

Dwelling Unit ◽

Urban Populations ◽

Social Accounts ◽

Dynamic Matching ◽

Matching Process ◽

Occupancy Patterns

A conception of the housing market as a lagged, dynamic matching process is presented as an alternative to the conventional microeconomic formulation. Various components of changes in occupancy patterns are identified, in a general multidimensional accounting framework, as a means for the structuring of observations of household and dwelling-unit characteristics of urban populations. Parameters for several stochastic models of housing-market phenomena are derived from the account-based representation. Finally, potential planning applications of these accounting frameworks are explored together with conditions for their adoption.

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House prices, land rents, and agglomeration benefits in the Netherlands

International Housing Market Experience and Implications for China ◽

10.1201/9780429438141-4 ◽

2019 ◽

pp. 62-87

Author(s):

Coen N. Teulings

Keyword(s):

The Netherlands ◽

House Prices ◽

Land Rents

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Discrimination in urban housing markets: Lessons from fair housing audits

Housing Policy Debate ◽

10.1080/10511482.1992.9521096 ◽

1992 ◽

Vol 3 (2) ◽

pp. 183-215 ◽

Cited By ~ 13

Author(s):

Margery Austin Turner

Keyword(s):

Housing Markets ◽

Urban Housing ◽

Fair Housing

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A look into German housing markets: A bubble call?

International Area Studies Review ◽

10.1177/2233865918802664 ◽

2018 ◽

Vol 21 (4) ◽

pp. 289-301

Author(s):

Jan R. Kim ◽

Gieyoung Lim

Keyword(s):

Housing Market ◽

House Prices ◽

House Price ◽

Housing Markets ◽

Present Value ◽

Present Value Model ◽

Price Bubbles ◽

Steep Rise ◽

Value Model ◽

German Housing Market

The steep rise in German house prices in recent years raises the question of whether a speculative bubble has already emerged. Using a modified present-value model, we estimate the size of speculative house price bubbles in the German housing market. We do not find evidence for positive bubble accumulation in recent years, and interpret the current bullish run as reflecting the correction of house prices that have been undervalued for more than 10 years. With house prices close to their fair values as of 2018:Q1, our answer to the question is, ‘Not yet, but it is likely soon’.

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