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Housing networks and driving forces

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  • Hurn, Stan
  • Shi, Shuping
  • Wang, Ben

Abstract

This paper investigates patterns in housing market networks using Australian and Chinese data and a novel econometric approach based on pairwise time-varying Granger causality tests. The focus is on four fundamental questions. (1) Have housing markets become increasingly connected over time? (2) Does housing market connectivity increase or decrease with house prices? (3) Are socio-economic and geographic proximity important for housing market connections? (4) Do economic fundamentals or sentiment drive connectivity? The results reveal interesting differences in these markets and suggest that one size is not likely to fit all in terms of housing market policy.

Suggested Citation

  • Hurn, Stan & Shi, Shuping & Wang, Ben, 2022. "Housing networks and driving forces," Journal of Banking & Finance, Elsevier, vol. 134(C).
    • Handle: RePEc:eee:jbfina:v:134:y:2022:i:c:s0378426621002685
    DOI: 10.1016/j.jbankfin.2021.106318
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    2. Wang, Wen-Kai & Lin, Che-Chun & Tsai, I-Chun, 2022. "Long- and short-term price behaviors in presale housing markets in Taiwan," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 350-364.
    3. Xu, Xiaoyue & Mi, Anran & Li, Xiuting & Li, Xuerong & Dong, Jichang, 2024. "Bad news travels fast: Network analysis of the Chinese housing market connectivity," China Economic Review, Elsevier, vol. 84(C).
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    5. Cheng-Wen Lee & Shu-Hen Chiang & Zhong-Qin Wen, 2023. "Pursuing the Sustainability of Real Estate Market: The Case of Chinese Land Resources Diversification," Sustainability, MDPI, vol. 15(7), pages 1-19, March.
    6. Yuan, Ying & Wang, Haiying & Jin, Xiu, 2022. "Pandemic-driven financial contagion and investor behavior: Evidence from the COVID-19," International Review of Financial Analysis, Elsevier, vol. 83(C).

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    More about this item

    Keywords

    Housing network; Granger causality; Connectivity; Fundamentals; Sentiment;
    All these keywords.

    JEL classification:

    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • R39 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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