House Price Synchronicity, Banking Integration, and Global Financial Conditions
IMF Working Papers, November 28, 2018
Source details
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- House Price Synchronicity, Banking Integration, and Global Financial Conditions
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Bibliographic details
- Authors: Adrian Alter, Jane Dokko
- Published: November 28, 2018
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484385692.001
Scope and data
- Sample covers 40 countries and about 70 cities over the past three decades.
- The study examines the role of cross-border banking flows in residential property markets.
Key findings
- Looser global financial conditions are associated with greater house price synchronicity, even after controlling for bilateral financial integration.
- Synchronicity across major cities may differ from that of their respective countries, perhaps due to the influence of global investors on local house price dynamics.
- Cross-border banking flows play a role in residential property market dynamics (role examined empirically).
Policy-relevant conclusions
- Policy choices such as macroprudential tools appear relevant for mitigating the sensitivity of domestic housing markets to the rest of the world.
- Exchange rate flexibility appears relevant for mitigating the sensitivity of domestic housing markets to the rest of the world.
Thematic tags and research context
- Subjects: Asset and liability management; Business cycles; Economic growth; Exchange rate arrangements; Financial crises; Foreign exchange; Global financial crisis of 2008-2009; Housing prices; International liquidity; Prices.
- Keywords (as listed): banking intergration; business cycles; cycle synchronicity; equity price return; Exchange rate arrangements; financial conditions; gap synchronicity; gaps of country; Global; Global financial crisis of 2008-2009; global liquidity; house price growth; house price synchronicity; house price synchronicity measure; Housing market; Housing prices; International liquidity; price gap synchronicity; synchronicity measure; WP.
IMF Working Paper: "House Price Synchronicity, Banking Integration, and Global Financial Conditions" by Adrian Alter and Jane Dokko.