United Kingdom : Selected Issues

Author/Editor:

International Monetary Fund

Publication Date:

March 3, 2003

Electronic Access:

Free Full Text (PDF file size is 1898 KB).Use the free Adobe Acrobat Reader to view this PDF file

Summary:

This Selected Issues paper examines the factors determining housing prices in the United Kingdom. Based on econometric evidence, the paper assesses whether recent housing price increases can be explained by fundamentals or whether they represent a temporary overshooting of housing prices, characteristic of a bubble. The paper estimates a simple error-correction model that describes the dynamics of real housing prices since the 1970s. Estimation results suggest that earnings and interest rates are the key determinants of housing prices, and that changes in real housing prices exhibit a large degree of persistence.

Series:

Country Report No. 03/47

Subject:

English

Publication Date:

March 3, 2003

ISBN/ISSN:

9781451814170/1934-7685

Stock No:

1GBREA0022003

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

60

Please address any questions about this title to publications@imf.org