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The demand for housing in Spain: an endogenous switching regression analysis

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  • Justo Manrique
  • Kalu Ojah

Abstract

Housing demand in Spain has been studied by using data disaggregated into primary and secondary housing demands. It is found that demand for both types of housing area, indeed, related and that they are both considered necessities; thus, suggesting that their consumption ought to be modelled as a joint decision. Moreover, it is found that traditional determinants of housing demand affect primary and secondary home demands differently. These differences are attributable to the following economic rationales: need for asset holdings diversifications, relative high cost of home ownership versus rental in choice locations, and differences in land demand intensity across regions. In sum, the findings suggest that policy makers in Spain, contrary to popular beliefs, must consider secondary homes an integral part of households' accommodation need.

Suggested Citation

  • Justo Manrique & Kalu Ojah, 2003. "The demand for housing in Spain: an endogenous switching regression analysis," Applied Economics, Taylor & Francis Journals, vol. 35(3), pages 323-336.
    • Handle: RePEc:taf:applec:v:35:y:2003:i:3:p:323-336
    DOI: 10.1080/00036840110111149
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    2. Nestor Gandelman, 2008. "Female-Headed Households and Homeownership in Latin America," Research Department Publications 3252, Inter-American Development Bank, Research Department.
    3. Arrazola, María & de Hevia, José & Romero, Desiderio & Sanz-Sanz, José Félix, 2014. "Determinants of the Spanish housing market over three decades and three booms: Long run supply and demand elasticities," Working Paper Series 18852, Victoria University of Wellington, Chair in Public Finance.
    4. Cao, Yangzhe & Swallow, Brent & Qiu, Feng, 2021. "Identifying the effects of a land-use policy on willingness to pay for open space using an endogenous switching regression model," Land Use Policy, Elsevier, vol. 102(C).
    5. Daniel Fernández-Kranz & Mark Hon, 2006. "A Cross-Section Analysis of the Income Elasticity of Housing Demand in Spain: Is There a Real Estate Bubble?," The Journal of Real Estate Finance and Economics, Springer, vol. 32(4), pages 449-470, June.
    6. Javier A. Barrios Garcia & Jose Enrique Rodriguez Hernandez, 2007. "Housing and Urban Location Decisions in Spain: An Econometric Analysis with Unobserved Heterogeneity," Urban Studies, Urban Studies Journal Limited, vol. 44(9), pages 1657-1676, August.
    7. Marion Kohler & Anthony Rossiter, 2005. "Property Owners in Australia: A Snapshot," RBA Research Discussion Papers rdp2005-03, Reserve Bank of Australia.
    8. Nestor Gandelman, 2006. "Gender differentials in homeownership in Latin America," Documentos de Investigación 30, Universidad ORT Uruguay. Facultad de Administración y Ciencias Sociales.
    9. Nestor Gandelman, 2008. "Hogares encabezados por mujeres y propiedad de la vivienda en América Latina," Research Department Publications 3253, Inter-American Development Bank, Research Department.
    10. Insik Min, 2007. "A nonparametric test of the conditional normality of housing demand," Applied Economics Letters, Taylor & Francis Journals, vol. 14(2), pages 105-109.
    11. Torres-Tellez, Jonathan & Montero Soler, Alberto, 2021. "El precio de la vivienda en España tras el inicio de la crisis económica: un análisis empírico || Housing prices in Spain after the beginning of the financial crisis: An empirical analysis," Revista de Métodos Cuantitativos para la Economía y la Empresa = Journal of Quantitative Methods for Economics and Business Administration, Universidad Pablo de Olavide, Department of Quantitative Methods for Economics and Business Administration, vol. 32(1), pages 376-391, December.
    12. Ming-Yuan Chen, 2006. "Managerial ownership and firm performance: an analysis using switching simultaneous-equations models," Applied Economics, Taylor & Francis Journals, vol. 38(2), pages 161-181.
    13. Narayanan, Sudha, 2014. "Profits from participation in high value agriculture: Evidence of heterogeneous benefits in contract farming schemes in Southern India," Food Policy, Elsevier, vol. 44(C), pages 142-157.

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