The Impact of Property Condition Disclosure Laws on Housing Prices: Evidence from an Event Study Using Propensity Scores

We examine the impact of seller??s Property Condition Disclosure Laws on residential real estate values. A disclosure law may address the information asymmetry in housing transactions shifting risk from buyers and brokers to the sellers and raising housing prices as a result. We combine propensity score techniques from the treatment effects literature with a traditional event study approach. We assemble a unique set of economic and institutional attributes for a quarterly panel of 291 US Metropolitan Statistical Areas (MSAs) across 50 US States spanning 21?years from 1984 to 2004. The study finds that the average sales price of houses in a metropolitan area increases by an additional 3 to 4% over a 4?year period if the state adopts a Property Condition Disclosure Law, which is consistent with approximately a 19 basis point or 6.4% reduction in the risk premium associated with purchasing owner-occupied housing. When we compare the results from parametric and semi-parametric (propensity score) event analyses, we find that the semi-parametric analysis generates moderately larger estimated effects of the law on housing prices.     

Corporate Disclosure Policy and the Informativeness of Stock Prices

We examine the association between voluntary corporate disclosure and the informativeness of stock prices. We measure corporate disclosure using the AIMR-FAF annual corporate disclosure ratings. We define price informativeness by the association between current stock returns and future earnings changes: more informative stock price changes contain more information about future earnings changes. To measure this association, we regress current returns against (current and) future earnings changes. The aggregated coefficient on the future earnings changes, which we refer to as the future ERC, is our measure of informativeness (association).We hypothesize and find that greater disclosure is associated with stock prices that are more informative about future earnings (i.e., higher future ERC). These results provide empirical support for the widely held, but heretofore empirically undocumented, belief that greater disclosure provides information benefits to investors.     

Housing Market Response to New Flood Risk Information and the Impact on Poor Tenant

The Journal of Real Estate Finance and Economics - This study examines how house prices were affected by the great Iowa flood of 2008. Transaction data on Des Moines’ housing market from 2000...     

Home-Purchase Limits and Housing Prices: Evidence from China

Home-purchase limits, introduced by China’s central government in April 2010 and afterward implemented by the local governments of major cities successively, were usually regarded as the most stringent policy instruments regulating over-heated Chinese housing markets over recent years. Our study attempts to investigate the effects of the home-purchase limits based on the micro data of resale housing transactions between January 2008 and December 2011 in Guangzhou city, one of the largest cities in mainland China. Our regression results show that, while the central government’s notice negatively affects housing prices, the localized home-purchase limit measures have positive effects on housing prices in Guangzhou, which deviate far from the expectations the policy makers might have. We also find that the effects of the policies are significantly stronger for the housing units of high-rise building (or with big size) relative to those without elevators (or with small size). We provide the explanation from the aspects of policy uncertainty and redevelopment option embodied in the housing.     

Pet Policy and Housing Prices: Evidence from the Condominium Market

This paper examines the economic impact of restrictions against keeping domestic pets in residential dwellings. Using a large data sample of condominium sales, we empirically estimate price effects associated with pet restrictions. Our results suggest that an unrestricted pet policy creates a significant premium in condominium price, along with discounts for condominiums that do not allow pets or have pet restrictions. This finding is useful for policy makers, developers of new condominium projects, and condominium owner associations in their decisions to establish or alter laws and regulations regarding restrictions on pet owner residents.     

住房价格、房屋购买与中国家庭杠杆率

本文基于中国家庭追踪调查的微观数据以及相匹配的城市层面的住房价格数据,从住房购买需求的角度,给出了一个近年来家庭杠杆率急剧上升的解释。利用中国家庭追踪调查的微观数据探讨了房价上涨对家庭杠杆率的作用机制以及潜在影响。结果表明,住房价格的快速上涨推动了家庭杠杆率的急剧攀升,从数量上看,房价每上涨1倍,样本期间的家庭贷款数额将会增长288.1%,家庭杠杆率将上升39.2%,而此部分贷款的增加主要来源于银行贷款而非私人借贷,由房价导致的家庭借贷数额和杠杆率的上升大概占到购房家庭总体借贷数额和杠杆率上升的90%左右。机制分析表明,住房价格的快速上涨刺激了家庭必需型和投资型住房需求,并提高了家庭的借贷意愿和风险偏好。分样本的探讨发现,这一效应对于非农户口家户以及有配偶和子女家户的影响更为明显。     

The Dynamic Impact of Macroeconomic Aggregates on Housing Prices and Stock of Houses: A National and Regional Analysis

This article analyzes the dynamic effects of four key macroeconomic variables on the housing prices and the stock of houses sold on the national and regional levels using a nonstructural estimation technique. The impulse response functions derived from the VAR suggest that macroeconomic variables produce cycles in housing prices and houses sold. The housing market was found to be very sensitive to shocks in the employment growth and mortgage rate at both the national and regional levels. In particular, regional housing prices reflect regional employment growth, as well as national mortgage rates. The study also reveals that the economic variables have a different impact on the dynamic behavior of housing prices and the number of houses sold in different regions at different time periods and that these economic aggregates alone cannot explain the fluctuations in real estate values and construction levels that occurred in some regions.     

房价过快上涨对实体经济的影响:文献综述

自1998年启动住房分配货币化改革以来,我国房地产市场发生了革命性的变化,房地产业已成为国民经济的重要支柱。而历史经验则已反复证明,如果经济发展过分倚重房地产,听任房地产价格持续快速上涨,将对投资及全要素生产率、消费、收入分配、财富分布,以及财政收入产生不利影响,并有可能诱发系统性风险,进而影响国民经济持续稳定健康发展。因此,要从供给侧加大改革力度,加大土地供给数量,调整财税体制,加快推进房地产税立法工作,加快形成促进房地产市场稳定发展的长效机制。     

Regional Housing Prices in the USA: An Empirical Investigation of Nonlinearity

Existing literature on housing prices is predominantly in a linear framework, and an important question that has not been addressed is whether housing prices exhibit nonlinearity. We examine Smooth Transition Autoregressive (STAR) model based nonlinear properties of housing prices over the 1969–2004 period for the entire US and the four regions. Our main findings are (1) housing price for the entire US and all regions except for the Midwest show non-linearity, (2) the dynamic properties implied by the nonlinear estimation explain the typical patterns that have characterized each housing market, and (3) results of Granger causality tests look more plausible in the nonlinear framework where we find stronger evidence of Granger causality from housing price to employment and also from mortgage rates to housing price.

The Value Relevance of Risk Disclosure: An Analysis of the Banking Sector

Abstract

The aim of this study is to test whether financial risk disclosures required by IFRS 7 and Pillar 3 are value relevant for investors to support them in their investment decisions. The sample in the study consists of banks listed on the London, Paris, Frankfurt, Madrid, and Milan Stock Exchanges over an 8-year period, from 2007 to 2014. Based on the aforementioned standards, we built financial risk disclosure indexes and distinguished different risk categories, qualitative and quantitative, as well as credit, liquidity, and market risk. Our analyses confirm that there is a positive association between bank value and several categories of established risk disclosures. Furthermore, it suggests that disclosure adds value to more traditional risk value measures. Besides, our results suggest that investors pay attention to the strength of the bank authority when using risk disclosures.     

Housing Prices and Maturing Real Estate Markets: Evidence from Uganda

Uganda, a less developed but rapidly growing East African nation, continues to correct the economic mismanagement of past governments. One important legacy of this mismanagement is the Land Decree of 1975, issued by then President Idi Amin Dada. This decree nationalized all land and made illegal all private real estate market transactions. This paper uses a rich, but little known, dataset to show that real estate markets appear to have continued operating reasonably efficiently in spite of the 1975 Decree. The Land Act of 1998 repealed the 1975 Decree. Our results suggest the recent Act has a high likelihood of success because its primary goal is to codify guarantees of security, transparency, and enforceable property rights in private real estate markets that appear to already exist.     

柳州市房地产信贷规模与房地产价格关系的实证分析

本文在对柳州市房地产市场发展的信贷支持进行定性分析的基础上,利用2003年1季度至2009年4季度的季度数据,运用多变量协整分析技术对房地产信贷与柳州房地产市场价格波动之间的关系进行实证检验,结果表明柳州房地产信贷规模变动是房地产价格变动的主要原因之一,但房地产信贷变化不是对房地产市场状况的反映。     

Prices and Protocols in Public Health Care

This article addresses the problem of how to determine the optimalallocation of public expenditure in the health sector. The firstpart poses the question: How should the set of services providedin the public health care system and the fees charged for thembe chosen to maximize the health status of the population witha fixed budget? First, the findings show that policy reformshould take into account the response of the private sector.Substituting for a reasonably well-functioning private sectoris not as valuable as providing services the private sectorcannot. Second, the assumptions needed to justify the cost-effectivenessof medical interventions as a criterion for setting prioritiesare so restrictive as to make this method usable in few, ifany, circumstances. Third, prices for any one service shouldbe set to balance the conflicting goals of encouraging its useand of conserving the budget for more effective services. The second part broadens the objective of policy to cover thestandard welfare economics concerns of utility and market failure,that latter being extensive in the health sector. It reexamineswelfare maximization rules to show that only the market failurecomponents of shadow prices are needed to calculate the welfaregains from public investments.     

The Impact of TOM on Prices in the US Housing Market

The Journal of Real Estate Finance and Economics - Search theory shows that real property prices and marketing durations are simultaneously determined and positively related. Yet, empirical studies...     

The Interaction between Mortgage Financing and Housing Prices in Greece

Although the close empirical relationship between the evolution of mortgage lending and housing prices is well established in the literature, the direction of causation is less clear from a theoretical standpoint. We apply multivariate cointegration techniques in order to address this issue empirically for the Greek economy. Our results, based on a cointegration relationship that we identify as a mortgage loan demand equation, indicate that housing prices do not adjust to disequilibria in the market for housing loans. This suggests that in the long run the causation does not run from mortgage lending to housing prices. In the short run we find evidence of a contemporaneous bi-directional dependence.

Leverage,Consumer Finance,and Housing Prices in China

In this article, we focus on the effect of household borrowing behavior on housing prices in China, under the background of rapid growth of consumer finance during the past decade. We build a micromodel to deduce the relationship between consumers’ leverage, housing enterprises’ leverage, and housing prices and use a dynamic panel model and panel error correction model to do the empirical work. The results show that the first- and second-tier cities of China are greatly influenced by leverages, the second-tier cities also by local growth, and the third-tier cities are weakly affected by leverages but greatly affected by the land prices. Further explanations and discussions of the empirical results are given accordingly.     

Delivering Public Services Under the New Public Management: The Case of Public Housing

One of the biggest changes in public sector housing practice in recent years has been the introduction of New Public Management techniques. Housing associations, promoted by successive governments to supplement local authority provision of social housing, have readily taken on the new management agendas of performance indicators and business disciplines in service delivery. The author identifies a conflict between the social purposes of public funding for housing and the business practices of housing associations. The limited accountability of housing associations allows for practices that lead to social exclusion. For local authorities, a parallel conflict arises because of government emphasis on 'what works' in public housing management, rather than on 'what matters'.