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Competing Risks in a Time on the Market Analysis

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  • Erik R. de Wit

    (Finance Group, University of Amsterdam)

Abstract

Theoretical models on the selling process in the housing market are scarce. Taylor (1999) specifies a model where time-on-the-market gives a quality signal of the house to potential buyers if inspection outcomes of the house are not public. We specify a duration model with competing risks, where the competing risks are a sale or a withdrawal from the market. We use a unique administrative dataset from the Netherlands. We find negative duration dependence in the hazard of sale and positive duration dependence in the hazard of withdrawal confirming the empirical predictions from Taylor (1999).

Suggested Citation

  • Erik R. de Wit, 2010. "Competing Risks in a Time on the Market Analysis," Tinbergen Institute Discussion Papers 10-108/2, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20100108
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    References listed on IDEAS

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    1. Huang, Ju-Chin & Palmquist, Raymond B, 2001. "Environmental Conditions, Reservation Prices, and Time on the Market for Housing," The Journal of Real Estate Finance and Economics, Springer, vol. 22(2-3), pages 203-219, March-May.
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    Cited by:

    1. Aydin, Erdal & Correa, Santiago Bohórquez & Brounen, Dirk, 2019. "Energy performance certification and time on the market," Journal of Environmental Economics and Management, Elsevier, vol. 98(C).
    2. de Wit, Erik R. & van der Klaauw, Bas, 2013. "Asymmetric information and list-price reductions in the housing market," Regional Science and Urban Economics, Elsevier, vol. 43(3), pages 507-520.

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    More about this item

    Keywords

    time-on-the-market; duration models; household finance; housing market;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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