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Nathanson, Charles Gordon. "Mean Reversion in Housing Markets." Thesis, Harvard University, 2014. http://dissertations.umi.com/gsas.harvard:11404.
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Booms in house prices are usually followed by busts. This pattern is called "mean reversion." Mean reversion in housing markets has historically coincided with economic recessions across the world. Chapter 1 establishes mean reversion in U.S. data, and attempts to explain it using the dynamics of wages in cities. Chapter 2 takes a different approach. It models mean reversion resulting from speculation and uncertainty. This model explains why strong mean reversion in prices occurs in cities where it is easy to build houses, a phenomenon that Chapter 1 cannot explain. Chapter 3 takes the spirit of Chapter 2 and applies it to the optimal design of the income tax.<br>Economics
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Li, Hanfu. "Three Essays in Housing Economics." The Ohio State University, 2013. http://rave.ohiolink.edu/etdc/view?acc_num=osu1366220622.
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McQuade, Timothy. "Essays in Financial and Housing Economics." Thesis, Harvard University, 2013. http://dissertations.umi.com/gsas.harvard:10857.
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This dissertation presents four essays. The first chapter builds a real-options, term structure model of the firm incorporating stochastic volatility and endogenous default to shed new light on the value premium, financial distress, momentum, and credit spread puzzles. The paper uses recently developed methodologies based on asymptotic expansions to solve the model. The second chapter, coauthored with Adam Guren, presents a model that shows how foreclosures can exacerbate a housing bust and delay the housing market's recovery. Quantitatively, the model successfully explains aggregate and retail price declines, the foreclosure share of volume, and the number of foreclosures both nationwide and across MSAs. The third and fourth chapters, coauthored with Stephen W. Salant and Jason Winfree, discuss the economics of untraceable experience goods in a variety of settings. The third chapter drops the "small country" assumption in the trade literature on collective reputation and shows how large exporters like China can address severe problems assuring the quality of its exports. The fourth chapter demonstrates how regulations in the formal sector of developing countries can lead to a quality gap between formal and informal sector goods. It moreover investigates how changes in regulation affect quality, price, aggregate production, and the number of firms in each sector.<br>Economics
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Struyven, Daan, and François Koulischer. "Housing and credit markets." Thesis, Massachusetts Institute of Technology, 2015. http://hdl.handle.net/1721.1/98659.
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Thesis: Ph. D., Massachusetts Institute of Technology, Department of Economics, 2015.<br>Title as it appears in MIT Commencement Exercises program, June 5, 2015: Essays on housing and credit markets. Chapter 2 co-authored by François Koulischer. Cataloged from PDF version of thesis.<br>Includes bibliographical references (pages 117-125).<br>This thesis consists of three chapters on housing and credit markets. Chapter 1 tests the "housing lock hypothesis": the conjecture that homeowners with limited or negative home equity, low levels of financial assets and restricted opportunities to borrow are unable to move. It employs unique, administrative population data on residential location, home-ownership, family structure, and household balance sheets from the Netherlands. The rapid rise in Dutch house prices during the 1995- 2008 period, and their substantial decline thereafter, has generated large variation in the home equity of buyers who bought homes a few years apart. Buyers in the cohorts that purchased homes around the peak have higher Loan-To-Value (LTV) ratios than earlier buyers, and also have much lower mobility rates in every year after purchase. A decline in home equity is associated with large and statistically significant reductions in household mobility. A rise in the LTV ratio from 90 to 115% is associated with a 30% decline in household mobility. The reduction in mobility is observed both within and across labor markets. The mobility effects of falling home equity are substantially larger for households with low financial asset holdings. These results emerge from comparisons of mobility rates from different purchase cohorts after removing time and region effects, as well as from an analysis of homebuyers whose purchase timing was determined by arguably exogenous changes in family structure. Since Dutch mortgages are full recourse, which rules out strategic default behavior, the findings provide new support for the "housing lock hypothesis". Chapter 2, co-authored with François Koulischer, studies the role of collateral in liquidity provision by central banks. Should central banks lend against low quality collateral? We characterize efficient central bank collateral policy in a model where a bank borrows from the interbank market or the central bank. Collateral has favorable incentive effects but is costly to transfer to lenders who value the collateral less because of imperfect collateral quality. We show that a fall in the quantity or the quality of the bank's collateral can increase interest rates in the economy even with a constant policy rate. A looser central bank collateral policy can reduce the spread, alleviate the credit crunch and increase output. Chapter 3 studies the effects of LTV limits, Payment-To-Income (PTI) limits and the mortgage interest deduction on mortgage debt exploiting a series of policy changes in the Netherlands. As intended, regulatory loan limits reduce mortgage leverage ratios and they also induce bunching at the loan limits. Loan limits and restrictions of the mortgage interest deduction trigger large declines in mortgage volumes. The leverage and volume responses are larger for young, borrowing-constrained households. The repeal of the mortgage interest deduction for non-amortizing mortgages decimates the market for non-amortizing mortgages. The PTI tightening is also associated with a substantial rise in the fraction of mortgages that have very short periods during which the interest rate is fixed. This unintended risk-shifting pattern to quasi- adjustable-rate mortgages (ARM) may increase income risk. The reform of the mortgage interest deduction, which boosts amortization, is also associated with a significant decline in principal amounts at origination. These findings highlight the distributional effects as well as the unintended potential consequences of macroprudential and fiscal policies aiming to reduce mortgage debt. This thesis tries to cast light on the effects of shocks to the value of housing and other types of collateral on the broader economy. This work suggests that the combination of imperfections in credit markets and shocks to asset prices can exert a substantial, non-linear and heterogeneous influence on household and firm outcomes, such as residential mobility (Chapter 1) and business investment (Chapter 2). This thesis also investigates the role for monetary, macroprudential and fiscal policies to alleviate or prevent the negative spill-over effects to the real economy, both before (Chapter 3) as well as after (Chapter 2) the occurrence of financial shocks.<br>by Daan Struyven.<br>Chapter 1. Chapter 2: Chapter 3. The Housing lock : Dutch evidence on the impact of negative home equity on household mobility -- Central Bank liquidity provision and collateral quality -- effects of macroprudential and fiscal policy on mortgage debt : evidence from the Netherlands.<br>Ph. D.
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Andersson, Karin. "Housing Investments and Economic Growth." Thesis, Uppsala University, Department of Economics, 2005. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-5975.
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<p>This paper examines the relationship between housing investments and economic growth. Through a literature review five different hypotheses are analysed to examine the effects of housing investments on economic growth. The studied effects include; direct effects, counter-cyclical effects, price effects and productivity effects through reduced mismatch between housing and labour markets, and finally effects on the productivity of workers. The conclusion is that the direct effects are only short term and the existence of counter-cyclical effects is doubtful. For the price effects and the effects on productivity there are less empirical evidence, but the effects are still considered significant. Keywords: housing investments, new construction, economic growth, effects 2</p>
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Evenson, Bengte 1975. "Empirical analyses of local housing markets." Thesis, Massachusetts Institute of Technology, 2002. http://hdl.handle.net/1721.1/8411.
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Thesis (Ph.D.)--Massachusetts Institute of Technology, Dept. of Economics, 2002.<br>Includes bibliographical references (p. 120-124).<br>This dissertation consists of three essays on the local regulation of housing supply and its influence on house price volatility. I begin by describing the local supply-side dynamics of housing price and stock in each of 47 U.S. metropolitan area housing markets using a unique, market-level panel dataset. The data are analyzed with a conditional vector-autoregression, which characterizes the dynamic responses of price and stock to an increase in housing demand caused by a shift in employment. These response time-paths are used to create measures of short-, medium- and long-run supply elasticities. Both the time-paths and the implied elasticities vary widely. I use several area characteristics to explain the variation in the supply elasticity measures across metropolitan areas. The results suggest that governments with a greater incentive to regulate housing have a slower house-price response. This directly contradicts the predictions of the existing land-use literature. In order to explain the result, William C. Wheaton and I formalize a general equilibrium theory of a housing market whose local governments determine house price by regulating their supplies of land. The regulatory decisions are made by current residents who already own housing, but the impact of these decisions on prices is determined by new entrants who must purchase housing. The choice of how much to regulate is shown to vary by town size, existing town density, and the amount of open land currently available for development. This is broadly consistent with the results of recent empirical research.<br>(cont.) I also find that the predictions of this theory are directly borne out in data on land-use restrictions across much of Massachusetts. Two types of residential land-use regulation are considered: regulation that restricts the share of land on which housing can be built, and regulation that restricts housing density on a given plot of land. I find evidence suggesting that the two types of regulation may enter the optimization problem of Massachusetts towns very differently, and that towns may regulate new housing more strictly than they did old housing.<br>by Bengte Evenson.<br>Ph.D.
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Davidoff, Thomas 1971. "Essays on annuitization and housing choice." Thesis, Massachusetts Institute of Technology, 2002. http://hdl.handle.net/1721.1/8409.
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Thesis (Ph.D.)--Massachusetts Institute of Technology, Dept. of Economics, 2002.<br>Includes bibliographical references (p. 113-117).<br>Chapter 1 For most US households, labor income is the most important source of wealth and housing is the most important risky asset. A natural intuition is thus that households whose incomes covary relatively strongly with housing prices should own relatively little housing. Under plausible assumptions on preferences and distributions, this result holds theoretically. Empirically, I find a significant effect: among US households, a one standard deviation increase in income-house price covariance is associated with a decrease of approximately $25,000 in the value of owner occupied housing. This empirical result implies greater cognizance of the interaction between labor income and asset risk on the part of households than suggested by most analyses of stock market behavior. The analysis also suggests that many homeowners enter financial markets in a riskier position than typically thought, and reinforces the intuitive appeal of proposals for market- or tax-based risk sharing in housing prices. Chapter 2 extends the theory of annuitization with no bequest motive in two directions. First, we derive sufficient conditions, in a more general setting than Yaari (1965), under which complete annuitization is optimal, and weaker conditions under which partial annuitization is better than zero annuitization. Second, we explore how incremental and complete annuitization affect consumer welfare in these more general conditions. When markets are complete, all savings are optimally annuitized as long as there is no bequest motive and annuitized assets have greater returns than conventional assets.<br>(cont.) Consumers' utility need not satisfy intertemporal additive separability nor the expected utility axioms, and annuities need not be actuarially fair. The result is weakened if annuities markets are incomplete, so that there are some assets which do not exist in annuitized form: as long as trade occurs all at once and consumption is positive in every state of nature, a small degree of annuitization is better than no annuitization. When conventional asset markets are incomplete, if annuities are illiquid, then it is possible that no savings are annuitized. We present numerical calculations of the financial benefit and optimal degree of annuitization for consumers with standard CRRA preferences, and compare these results to results where otherwise identical consumers have utility that depends both on present consumption and a standard of living to which they have grown accustomed. In our specification, the effect of adding intertemporal dependence hinges on the size of initial standard of living relative to resources. Chapter 3 addresses the measurement of income sorting and the attribution of observed sorting to different causes. In terms of measurement, I show that a standard decomposition of variance of household income into within jurisdiction and between jurisdiction components understates sorting in the presence of measurement error. Using 1990 US Census data, I find that adjusting for this error approximately doubles the estimated extent of sorting. On average, across all US metropolitan areas (MSAs) I find that approximately ten percent of the variation in household income can be explained by differences across jurisdictions ...<br>by Thomas Davidoff.<br>Ph.D.
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Kim, Dongwook. "The determinants of urban housing prices in 1982-1990." Connect to resource, 1993. http://rave.ohiolink.edu/etdc/view.cgi?acc%5Fnum=osu1265984382.
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Garino, Gaia. "A competitive temporary equilibrium approach to the housing and mortgage markets." Thesis, University of York, 1996. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.297108.
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Jewkes, Melanie. "An Assessment of Housing Affordability in Cache County, Utah." DigitalCommons@USU, 2008. https://digitalcommons.usu.edu/etd/70.
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Multiple housing affordability indexes are used to measure and assess housing affordability. Each index has its own definition of affordability, causing varying viewpoints on what is to be considered affordable or unaffordable. Four indexes were used in this study: two from the Department of Housing and Urban Development (HUD), one from the National Association of Realtors (NAR), and the last from the National Low Income Housing Coalition. The indexes were applied to Census data to assess the housing affordability situation of both homeowners and renters in the census tracts of Cache County, Utah. The measures together show distinct differences in the housing markets throughout the county. The study provides implications for housing counselors, educators, lenders, and policy makers, and provides suggestions for preventing housing crisis, including the benefits of the residual income approach for determining housing affordability
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Ngai, Christopher. "Estimating the demand structure of housing characteristics: a nonparametric approach." Oberlin College Honors Theses / OhioLINK, 1995. http://rave.ohiolink.edu/etdc/view?acc_num=oberlin1342186655.
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Seslen, Tracey Nicole 1977. "Housing price dynamics and household mobility decisions." Thesis, Massachusetts Institute of Technology, 2003. http://hdl.handle.net/1721.1/17629.
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Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2003.<br>Includes bibliographical references.<br>The first chapter attempts to shed light on the role of housing price dynamics in mobility decisions, asking whether households respond to prices in a forward- or backward-looking manner, and the extent to which high leverage constrains moving behavior. On a broader level, the study tests whether price dynamics dominate non-market shocks as a force governing household mobility, given the importance of housing as an investment good and saving device. Using a 13 year sample from the Panel Study of Income Dynamics, I find that households are largely backward-looking in both their mobility and consumption decisions, and that non-market shocks play a significant role. Households show little or no response to equity constraints, and do not appear to time the market, despite significant forecastability in housing prices. These conclusions lend support to the notion of prices leading trading volume, but do not support the theoretical work of Stein (1995), which attributes mobility behavior to changes in equity constraints brought about by changes in housing prices. The second chapter uses data from the Retirement History Survey to measure the impact of property tax abatement programs on elderly homeownership decisions. Analysis using a competing risks framework, in which the decision to trade down is treated separately from the decision to end homeownership completely, shows striking differences in the impact of property taxes on each type of failure: for the elderly who choose to trade down, property taxes have a positive effect on the hazard of moving. Alternatively, property taxes have little impact on the tenure decision. Incorporating individual heterogeneity to correct for sample bias, to capture mover-stayer effects, and to account for correlation between property taxes and omitted variables, has little effect on the results. From an "ex post" perspective, the results of the analysis lead to the conclusion that property tax abatement programs have a small impact at best, and may be leading to undesirable redistributional outcomes. The final chapter employs data from the neighborhood clusters sample of the 1989 American Housing Survey and the wealth supplement of the 1989 Panel Study of Income Dynamics to study to distribution of wealth within US residential neighborhoods. Calculations using the Bourguignon decomposable inequality index show that wealth is more unequally distributed than income, and income more than housing wealth, at all levels of aggregation--neighborhoods, metropolitan areas, census regions, and the entire US.<br>by Tracey Nicole Seslen.<br>Ph.D.
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Shan, Hui Ph D. Massachusetts Institute of Technology. "Tax policy, housing markets, and elderly homeowners." Thesis, Massachusetts Institute of Technology, 2008. http://hdl.handle.net/1721.1/43728.
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Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2008.<br>This electronic version was submitted by the student author. The certified thesis is available in the Institute Archives and Special Collections.<br>Includes bibliographical references.<br>This dissertation consists of three essays studying the impact of tax policy on housing markets and elderly homeowners. Chapter One examines the potential lock-in effect of capital gains taxation on home sales, using the Taxpayer Relief Act of 1997 (TRA97) as a policy instrument. Before 1997, homeowners were subject to capital gains taxation when they sold their houses unless they purchased replacement homes of equal or greater value. Since 1997, homeowners can exclude $500,000 of capital gains when they sell their houses. Using zip-code level housing price indices and sales data from 1982 to 2006 on single-family houses in 16 affluent towns within the Boston metropolitan area, I find that TRA97 reversed the lock-in effect for houses with low and moderate capital gains. However, the semiannual home sale rate of houses with capital gains above $500,000 declined after TRA97, suggesting that TRA97 generated an unintended lock-in effect for houses with capital gains over the maximum exclusion amount. Chapter Two studies the relationship between property taxes and elderly mobility. This is the first study using an instrumental variable approach to address the endogeneity problem associated with property taxes in analyzing elderly mobility. Using household-level panel data from the Health and Retirement Study (HRS) and a newly-collected dataset on state-provided property tax relief programs, I find evidence suggesting that higher property taxes raise mobility rates among elderly homeowners. Eligibility for relief programs lowers mobility rates, and the impact of these programs appears to vary with program types, program generosity, and implementation strategy.<br>(cont.) Chapter Three investigates the effect of property taxes on elderly homeowners labor supply decisions, using similar data and empirical strategy employed in Chapter Two. I examine both the extensive margin - whether elderly homeowners' delay retirement or reenter the labor force in the face of rising property taxes, and the intensive margin - whether elderly homeowners work longer hours when property taxes increase. I find little evidence that property taxes have a significant impact on elderly labor supply.<br>Hui Shan.<br>Ph.D.
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Kei, Wendy Wai Yee. "Essays on the economics of aging and housing." Thesis, University of British Columbia, 2016. http://hdl.handle.net/2429/58653.
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This dissertation uses three different studies to explore the impact of household finance on elderly households’ labour market activities. Chapter 1 provides an introduction. Chapter 2 uses the eligibility requirements of the Canadian Old Age Security (OAS) program as a novel approach to estimate a causal effect of public pensions on elderly immigrants’ labour supply decisions. I also evaluate the extent to which these individuals may adjust their labour supply behaviour prior to the receipt of public pension entitlements. The findings in this chapter illustrate that seniors only respond to the OAS benefits with a decrease in labour force participation rates. A combination of estimates implies that elderly immigrants may exhibit behavioural response in anticipation for OAS benefits. Chapter 3 investigates the effect of immigration on mobility decisions of native-born near-retirees. The research findings in this chapter push this area of literature forward by suggesting an alternative perspective for explaining native out-migration. The heterogeneity in mobility preferences across dwelling tenure groups is an important result because it may explain why Card (2001) fails to find any significant effect from immigration on aggregate native relocation decisions. Finally, Chapter 4 explores how the recent house price shock in the U.S. affected the labour supply decisions of near-retirees. This is the first study to use the national lending conditions for residential mortgage series as part of an instrumental variable strategy to explore this context. The final chapter sheds light by showing that housing exerts insignificant impact on the near-retirees’ work and retirement decisions.<br>Arts, Faculty of<br>Vancouver School of Economics<br>Graduate
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Kiefer, Hua. "Essays on applied spatial econometrics and housing economics." Columbus, Ohio : Ohio State University, 2007. http://rave.ohiolink.edu/etdc/view?acc%5Fnum=osu1180467420.
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Wolf, Clara. "Housing and monetary policy : three essays on empirical housing economics and international monetary policy." Thesis, Paris, Institut d'études politiques, 2016. http://www.theses.fr/2016IEPP0067.
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Cette thèse étudie des sujets hétérogènes puisqu'elle s’intéresse à la fois à l'économie du logement et à la politique monétaire internationale à l’aide de divers outils, tels que la modélisation théorique, l’évaluation microéconomique d’une politique publique, et une approche macroéconomique empirique. Elle est constituée de trois chapitres. Le premier, co-écrit avec Eric Monnet, s'intéresse à la relation entre les changements démographiques au sein des pays et l’investissement résidentiel. Le second, co-écrit avec Guillaume Chapelle et Benjamin Vignolles, évalue l'impact d'un dispositif d’incitation fiscale à l’investissement locatif sur plusieurs dimensions du marché du logement français. Enfin, le troisième étudie comment la politique monétaire devrait réagir aux afflux de capitaux en cas de frictions sur le marché financier<br>This thesis investigates heterogeneous topics since it is related to both housing economics and monetary economics, and uses various tools including theoretical modeling, microeconomic policy evaluation and macroeconomic empirical approach. It is constituted of three chapters. The first one, co-authored with Eric Monnet, is interested in the relationship between demographic changes within countries and housing investment. The second one, co-authored with Guillaume Chapelle and Benjamin Vignolles, assesses the impact of a housing tax credit on several dimensions of the housing market. Finally, the third one studies how monetary policy should react to capital inflows when there are frictions on the financial market
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Birks, D. F. "The development of a marketing information system in a charitable housing association." Thesis, University of Salford, 1987. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.381561.
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Sims, David P. 1975. "Unintended consequences of education and housing reform incentives." Thesis, Massachusetts Institute of Technology, 2004. http://hdl.handle.net/1721.1/28822.
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Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2004.<br>Includes bibliographical references.<br>(cont.) low achieving children.<br>This thesis measures some unintended consequences of government education and housing policies. Chapter 1 estimates the net educational effect, measured by student test scores, of the California Class Size Reduction Program on second and third graders. This program inadvertently created incentives for schools to combine students in multiple grade classrooms as well as reduce class size. Using the non-linear relationship between enrollment and combination classes I estimate that students placed in combination classes by the program suffered a large, significant drop in test scores. I also find little evidence of positive achievement effects due to smaller class size suggesting that the program's net effect may have been negative. Chapter 2 seeks to identify the effects of rent control on cities in the Boston area using the variation provided by a 1995 Massachusetts ballot initiative banning rent control. My findings support the intuition economist derive from simple economic models of price ceilings. Though rent controls achieve their stated aim of lowering rents, they also decrease the willingness of owners to rent apartments, lead to housing unit deterioration, and result in inefficiently long tenancy durations. I also find suggestive evidence that the deterioration in rent controlled housing quality may lower the rent in nearby non-controlled units. Chapter 3 examines an unintended strategic response of school districts to accountability testing. Using Wisconsin data I show that some school districts advance the starting date of their school year to allow their students more time to prepare for state accountability tests. I find that this leads to small test score gains in math, but may lead to higher absence rates and reduced reading scores among<br>by David P. Sims.<br>Ph.D.
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Hou, Yongzhou. "Urban Housing Markets in China." Doctoral thesis, KTH, Fastigheter och byggande, 2009. http://urn.kb.se/resolve?urn=urn:nbn:se:kth:diva-11423.
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This thesis focuses on problems of prices and risks in the housing markets of urban China. What drives the dynamics of housing prices across regions is not only of great interest for academic researchers but also of first importance for policy makers. It is also interesting to pay attention to the issue of housing bubbles at a city level and risk allocations from an institutional view. To address the issues, the thesis applies both qualitative and econometric approaches in analyzing the urban housing markets of China. The first paper reviews articles mainly published in Chinese core journals. The existing studies are mainly concerned with such six topics as institutions, policy, land, finance, price and market. The first three topics involve the public housing allocation system reform, such fiscal and monetary tools as tax and interest rate, and the land reserve system. The housing finance treats such subjects of mortgages, bubbles and financial systems, while housing prices explore factors such as land prices, construction cost and exogenous forces like income. Finally, the housing market addresses housing circles and the relationship between housing demand and supply. In paper 2, the housing price dynamics is investigated at a national level and across regions by using the panel data with 30 provinces over 7 years (2001-2007). The empirical results suggest that the estimates for the fundamentals of income, user cost, housing stock and employment are robust at a national level, implying that there exists a stationary equilibrium relation in the long run between the housing price and the fundamentals above. The speed of price adjustment varies considerably across regions in the East, Midland and West. Then the housing markets in Beijing and Shanghai are examined in Paper 3 to quantify possible existence of a bubble in the two metropolitan areas. This article uses an integrated strategy involved with such fundamentals as interest rates, rent, income and GDP. The results show that Beijing might have been on the way of forming a housing price bubble between 2005 and 2008, and that there possibly existed a bubble in Shanghai from 2003 to 2004. By comparing the risk allocation in China with that in Sweden, Paper 4 explores the difference of actual risks taken by various actors. The banks and governments appear to take more risks in China, especially as the Chinese developers have a weaker financial situation than in Sweden. Households have more choices to reduce the risk by purchasing various kinds of insurance products and also by binding the interest rate.<br><p>QC 20100720</p>
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Lande, Caleb David. "Homeowner Views on Housing Market Valuation of Energy Efficiency: An Empirical Investigation." The University of Montana, 2008. http://etd.lib.umt.edu/theses/available/etd-06092008-144721/.
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This paper investigates the relationship between energy efficiency and owner reported home value using American Housing Survey data. A hedonic price model is developed in order to isolate the impact of home energy use on the owners perceived market value of the home. In order to limit the impact of fixed housing characteristics on the model, the fixed effect regression technique is used. Empirical estimation provides evidence that homeowners feel the housing market assigns very limited value to the energy efficiency of their homes.
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Warsame, Abukar. "Supplier structure and housing construction costs." Licentiate thesis, Stockholm : Division of Building and Real Estate Economics, Royal Institute of Technology, 2006. http://urn.kb.se/resolve?urn=urn:nbn:se:kth:diva-4099.
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Baron, Aneil. "Three Essays on the Applications of Housing Transactions." The Ohio State University, 2016. http://rave.ohiolink.edu/etdc/view?acc_num=osu1468450347.
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Schmidt, Carolin [Verfasser], and Ted [Akademischer Betreuer] Azarmi. "Essays on Housing Economics / Carolin Schmidt ; Betreuer: Ted Azarmi." Tübingen : Universitätsbibliothek Tübingen, 2018. http://d-nb.info/1168238323/34.
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Lee, Nai Jia. "Panel data analyses of urban economics and housing markets." Thesis, Massachusetts Institute of Technology, 2009. http://hdl.handle.net/1721.1/55133.
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Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Urban Studies and Planning, 2009.<br>Cataloged from PDF version of thesis.<br>Includes bibliographical references (p. 96-100).<br>The thesis looks three pertinent issues in Housing Market and Urban Economics literature with panel data- home sales and house price relationship, efficiency of housing market and commercial property taxation. For the first part, I examine the strong positive correlation that exists between the volume of housing sales and housing prices. I develop a simple model of these flows which suggests they generate a negative price-to-sales relationship. This runs contrary to a different literature on liquidity constraints and loss aversion. Our results from both are strong and robust. Higher sales "Granger cause" higher prices, but higher prices "Granger cause" both lower sales and a growing inventory of units-for-sale. These relationships together provide a more complete picture of the housing market - suggesting the strong positive correlation in the data results from frequent shifts in the negative price-to-sales schedule. For the second part, I tested the hypothesis whether the housing market is efficient and whether "bargains" can be found in the market or not. According to the User cost model, house price appreciation is positively correlated to price. Nevertheless, such correlation between price and appreciation can be caused by productivity differences, behavioral reasons or high transaction costs. Using 4 unique sets of panel data at zip code level, I am able to test the efficiency hypothesis without worrying about productivity reasons and transaction costs. In addition, I tested the efficiency hypothesis by removing influences caused by changes in buyers' preferences over time. The results show that appreciation and house price is positively correlated in San Diego, Boston and Phoenix.<br>(cont.) However, appreciation and house price is negatively correlated in Chicago. For the last part, I examine an unusual phenomenon in Massachusetts, where some municipals impose a high property tax on commercial properties and low tax on residential properties. Unlike past studies, we treat the tax on firms as an entrance fee or compensation for the negative externalities the firms generate. This approach fits our context better because we are dealing with municipals- most of the individuals don't work where they live, and the firms are unlikely to provide them employment or other benefits. I develop a simple model to capture the firms' location decision and residents' demand for services and aversion to firms. The model suggests that rich neighborhoods tend to impose high commercial and residential property tax, as they try to reduce their reliance on firms for services. In addition, the municipals will impose a high commercial property tax rate if the number of firms in municipal is large. I assembled a panel data base covering 351 municipals over a period from 1975-2007. The empirical results strongly support the model, suggesting rich municipals rely less on firms.<br>by Nai Jia Lee.<br>Ph.D.
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Tang, Cheng Keat. "Essays in the economics of transportation, housing and discrimination." Thesis, London School of Economics and Political Science (University of London), 2018. http://etheses.lse.ac.uk/3797/.
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This thesis consists of three papers that are related to transportation economics, housing economics, and the economics of discrimination. The first paper examines how much people are willing to pay (WTP), on average, to avoid road traffic near their residence using the housing market. The notion is that traffic confers substantial negative externalities such as congestion delays, air and noise pollution, and traffic accidents. Estimating these hedonic functions are, however, extremely challenging with omitted variable bias and sorting of households. Hence, to circumvent these challenges, I rely on the sharp variation in traffic conditions induced by the London Congestion Charge to recover the capitalization of road traffic on housing values. The second paper examines whether installing speed cameras reduces traffic accidents and saves lives. Speeding is one of the major reasons why accidents occur, and the velocity of the vehicles affects the gravity of collisions. This paper sheds insights on how the government could intervene and nudge drivers from risky behaviours that could have serious consequences. The third paper investigates whether facial attractiveness affects sentencing outcomes in courtrooms. I rely on a novel facial recognition system that locates various features from inmate mugshots to compute facial symmetry as a measure of attractiveness. This study is motivated by the burgeoning literature indicating that judges allow extraneous factors, such as race and gender of defendants, emotions and media attention, to influuence their decisions, and the widespread discrimination of appearance in multiple contexts.
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Palmer, Christopher John. "Essays on the functioning of housing and labor markets." Thesis, Massachusetts Institute of Technology, 2014. http://hdl.handle.net/1721.1/90127.
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Thesis: Ph. D., Massachusetts Institute of Technology, Department of Economics, 2014.<br>Cataloged from PDF version of thesis.<br>Includes bibliographical references (pages 194-206).<br>The first chapter consists of my job-market paper. The foreclosure rate of sub-prime mortgages increased markedly across 2003-2007 borrower cohorts-sub-prime mortgages originated in 2006- 2007 were roughly three times more likely to default within three years of origination than mortgages originated in 2003-2004. Many have argued that this surge in sub-prime defaults represents a deterioration in sub-prime lending standards over time. I quantify the importance of an alternative hypothesis: later cohorts defaulted at higher rates in large part because house price declines left them more likely to have negative equity. Using loan-level data, I find that changing borrower and loan characteristics explain approximately 30% of the difference in cohort default rates, with almost of all of the remaining heterogeneity across cohorts attributable to the price cycle. To account for the endogeneity of prices, I employ a nonlinear instrumental-variables approach that instruments for house price changes with long-run regional variation in house-price cyclicality. Control function results confirm that the relationship between price declines and defaults is causal and explains the majority of the disparity in cohort performance. I conclude that if 2006 borrowers had faced the same prices the average 2003 borrower did, their annual default rate would have dropped from 12% to 5.6%. The second chapter is joint with David Autor and Parag Pathak. Externalities from the attributes and actions of neighborhood residents onto the value of surrounding properties and neighborhoods are central to the theory of urban economics and the development of efficient housing policy. This paper measures the capitalization of housing market externalities into residential housing values by studying the sudden and largely unanticipated 1995 elimination of stringent rent controls in Cambridge, Massachusetts, which had previously muted landlords' incentives to invest in their properties and altered the assignment of residents to locations. Pooling administrative data on the universe of assessed values and transacted prices of all Cambridge residential properties between 1988 and 2005, we find that rent decontrol genrated substantial, robust price appreciation at decontrolled units and nearby never-controlled units, accounting for an estimated 30 percent of the $7.8 billion in Cambridge residential property appreciation during this period. The majority of this contribution is due to induced appreciation of never-controlled properties, while residential investments can explain only a small fraction of the total. The third chapter is joint with Denis Chetverikov and Bradley Larsen. We present a methodology for estimating the distributional effects of an endogenous treatment that varies at the group level when there are group-level unobservables, a quantile extension of Hausman and Taylor (1981). Standard quantile regression techniques are inconsistent in this setting, even if the treatment is exogenous. Using the Bahadur representation of quantile estimators, we derive weak conditions on the growth of the number of observations per group that are sufficient for consistency and asymptotic normality. Simulations confirm the superiority of this grouped instrumental variables quantile regression estimator to standard quantile regression. An empirical application finds that low-wage earners in the U.S. from 1990-2007 were significantly more affected by increased Chinese import competition than high-wage earners. We also illustrate the usefulness of the estimation approach with additional empirical examples from urban economics, labor, regulation, and empirical auctions. Chapter 1 Keywords: Mortgage Finance, Sub-prime Lending, Foreclosure Crisis, Negative Equity Chapter. 2 Keywords: Urban Economics, Residential Externalities, Rent Control, Price Regulations. Chapter 3 Keywords: Quantile Regression, Instrumental Variables, Panel Data, Wage Inequality, Import Competition. Chapter 1 JEL Classification: GOl, G21, R31, R38. Chapter 2 JEL Classification: D61, H23, R23, R31, R32, R38 Chapter 3 JEL. Classification: C21, C31, C33, C36, J30.<br>by Christopher John Palmer.<br>Ph. D.
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Chen, Xiao Hu. "Effects of government's land supply and public housing on Hong Kong's residential market : a dynamic model of new housing supply." Thesis, University of Macau, 2012. http://umaclib3.umac.mo/record=b2537063.
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Andrew, Mark. "Behavioural change in the British housing and labour markets : an empirical analysis using panel data." Thesis, University of Reading, 2001. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.367741.
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Zhou, Yu. "Two Essays on American Housing Markets: the Determinants of Housing Value Volatility and the Ownership Decision of Manufactured Housing." The Ohio State University, 2009. http://rave.ohiolink.edu/etdc/view?acc_num=osu1243886980.
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Ma, Li. "Essays in Housing Choices and Consumer Behavior." The Ohio State University, 2012. http://rave.ohiolink.edu/etdc/view?acc_num=osu1337930256.
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Goldstein, Jonathan. "Rethinking Housing with Agent-Based Models| Models of the Housing Bubble and Crash in the Washington DC Area 1997-2009." Thesis, George Mason University, 2017. http://pqdtopen.proquest.com/#viewpdf?dispub=10275284.
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<p> This dissertation presents a series of related agent-based models (ABMs) of the housing market in the Washington DC Metropolitan Statistical Area. The models investigate the causes of the housing market bubble and crash during the time period 1997-2009 and policies that could have avoided such a crisis. The work in this dissertation contributes to three research areas: understanding the underlying causes of the housing crisis, demonstrating the ability of ABMs to generate important macro phenomena, and improving ABM methodology. </p><p> Using the housing market models, I investigated counterfactual policies related to the causes of the crisis. I show that leverage and expectations are the two most prominent contributors to the bubble, but that other factors, such as interest rates, norms governing the share of income going to housing, and seller behavior all influence the bubble. I find that lending standards and refinance rules play almost no part in the bubble, contrary to some theories of the housing crisis. Towards the end of the dissertation, I pair the housing market with a model of mortgage-backed securities. I show that the increased velocity of lending made possible by securitization can increase the size of bubbles and make markets more fragile, increasing the likelihood of crashes. </p><p> The ABMs in this dissertation exploit multiple large, heterogeneous data sets and utilize behavioral rules that are more realistic than conventional neoclassical specifications to reproduce detailed housing market dynamics. Input data include loan level data, multiple listing service (MLS) records, and demographic information from a variety of sources. The ABMs exploit this data by choosing the precise areas of input distributions to use based on the context of the model. This allows the ABMs to match not only aggregate outputs, but intermediate outputs and data distributions. For example, the ABMs in this dissertation not only reproduce empirical macro phenomena, such as the shape of the house price index, but also intermediate variables (e.g., distribution of loan types, average leverage, average days on market, average ratio of sold price to original listing price) and output distributions (e.g., distribution of house prices). </p><p> Throughout the dissertation I follow several methodological principles in construction and analysis of the ABMs. First, I demonstrate the use of data to constrain the models. Next, I describe a sensitivity analysis methodology that goes beyond parametric variations, but also varies model rules in what I term a structural sensitivity analysis. I demonstrate how criticisms about ABMs with regard to their opacity, brittleness, and dependency on arbitrary modeling decisions can be resolved through such an analysis. I also describe the architectural design of the models, which makes explicit the theoretically-inspired behavioral rules, facilitating structural sensitivity analyses.</p><p>
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Choi, Seok Joon. "Three essays on agent behavior in United States housing market." Related electronic resource: Current Research at SU : database of SU dissertations, recent titles available full text, 2005. http://wwwlib.umi.com/cr/syr/main.
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Wallace, Peggy. "Earth Sheltered Housing in Warren County, Kentucky: Description of Housing Units & Determinants of Residents' Satisfaction." TopSCHOLAR®, 1988. https://digitalcommons.wku.edu/theses/2944.
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The known population of earth sheltered houses in Warren County, Kentucky were studied (a) to document building materials and techniques utilized, (b) to describe the residents demographically and document their attitudes regarding satisfaction with earth sheltered housing, and (c) to determine reasons for building and resources utilized in financing and planning, as well as problems encountered in regard to the earth sheltered house.
Data on 21 housing units were collected through personal interviews. Data analysis was accomplished using contingency tables, chi-squares, Pearson's product-moment correlation, and multiple stepwise regression.
The earth sheltered house found to provide residents with high satisfaction was generally a chambered elevational structure which had cast-in-place concrete walls at the earth contact points with an exposed wood frame roof and a concrete floor. Amounts of soil coverage on the exterior varied, as did the use of insulation below grade. Waterproofing systems usually included drainage tile, swale(s), plastic sheeting, and a built-up asphalt or pitch coating applied to the exterior walls. A wood stove and central heating system were the most frequently used sources of heat. Air conditioning was utilized by most residents in the summer, although a window air conditioning unit often provided adequate cooling of the entire house. Ventilation was not a concern and dehumidification was seldom a concern for the residents. All 19 original owners (90% of the house owners in the study) acted as their own contractors, hiring professionals for such tasks as soil testing and subcontracting, and most reported no difficulty with financing and planning the earth sheltered house. Information on building the earth sheltered house was most often obtained from family and friends. The most common reasons for choosing this housing alternative were energy conservation and low cost.
Resident satisfaction was high for most aspects of the earth sheltered house included in the study. All residents reported high overall satisfaction with the earth sheltered house and most of the housing systems investigated. Significant (p < .01) contributors to residents' computed total satisfaction score (TSS) were satisfaction with lack of mildew and satisfaction with natural lighting in the house (90% of variance explained). The addition of satisfaction with lack of condensation on windows, satisfaction with exterior appearance, and satisfaction with performance of the waterproofing system to the regression equation brought the explained variance to 98%. Significant (p < .01) to residents' self-reported overall satisfaction with their earth sheltered houses were satisfaction with heating and cooling expenses and satisfaction with interior surface temperature (59% variance explained). None of the other variables, housing related or demographic, added significantly to explained variance in the TSS or self-reported overall satisfaction with earth sheltered housing.
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Williams, David Richard. "Estimation of black and white housing services demand elasticities in the United States using a simultaneous model of tenure choice and housing services demand." Gainesville, FL, 1986. http://www.archive.org/details/estimationofblac00will.
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Kwok, Hon-ho. "Trading volume and liquidity premium in the Hong Kong housing market." Click to view the E-thesis via HKUTO, 2006. http://sunzi.lib.hku.hk/hkuto/record/B36881909.
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Jauregui, Andres Hite Diane. "Three essays on real estate, environmental, and urban economics using the hedonic price model technique." Auburn, Ala., 2006. http://repo.lib.auburn.edu/2006%20Spring/doctoral/JAUREGUI_ANDRES_28.pdf.
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Waights, Sevrin. "Essays on the urban economics of housing and land markets." Thesis, London School of Economics and Political Science (University of London), 2014. http://etheses.lse.ac.uk/1023/.
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This thesis is comprised of four main chapters. Although the chapters are distinct works, they are related by their focus on housing and land markets and their reliance on urban economic theory and methods. They aim to contribute to the understanding of how these spatial markets function in order to work towards an improved implementation of urban policy. In particular this thesis tries to understand how house prices are determined by demand- and supply-side factors across different scales. It provides support for the idea that at a local level prices are determined by demand, in that they compensate for differences in locational amenities. It also investigates some of the consequences of price determination such as displacement of original residents from gentrifying neighbourhoods and welfare losses as a result of planning restrictions to development. The overall message that emerges from the body of work is that urban policy should pay close attention to the way that supply and demand interact to determine prices in markets for housing and land.
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Maniar, Megha. "The Great Indian Affordable Housing Crisis: Determining the Price and Income Elasticities of Urban Rental Housing Demand." Scholarship @ Claremont, 2012. http://scholarship.claremont.edu/cmc_theses/328.
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The Indian urban rental market is complex and yet ever-changing, with the ups and downs of housing demand playing a fundamental role in the affordability and stability of the market. This paper determines the income and price elasticities of demand using the demand function and Slutsky equation, respectively, for the urban rental market in order to help craft suitable national housing policy. Through this analysis, it is determined that the urban rental price elasticity of demand is -0.93 and the income elasticity is 0.81, suggesting that rental price subsidies and private income taxes are the most effective policy measures to ensure affordability in urban India.
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Sinai, Todd M. (Todd Michael). "The effect of tax reform on the owner-occupied housing market." Thesis, Massachusetts Institute of Technology, 1997. http://hdl.handle.net/1721.1/10326.
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Chung, Eui-chul. "Length of stay, housing consumption and tenure choice : an intertemporal analysis." The Ohio State University, 1994. http://rave.ohiolink.edu/etdc/view?acc_num=osu1272487319.
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Chen, Jie. "Empirical Essays on Housing Allowance, Housing Wealth, and Aggregate Consumption." Doctoral thesis, Uppsala : Department of Economics, Uppsala University, 2005. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-6202.
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Zhao, Bo. "Racial and ethnic discrimination in urban housing markets evidence from audit studies /." Related electronic resource: Current Research at SU : database of SU dissertations, recent titles available full text, 2005. http://wwwlib.umi.com/cr/syr/main.
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Ghourchian, Shahrzad. "Three Essays on Growth, Housing Market and Inequality." FIU Digital Commons, 2018. https://digitalcommons.fiu.edu/etd/3792.
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This dissertation includes three essays on growth, the housing market, and inequality. In the first essay, I analyze the effects of government consumption and government debt on long-run economic growth by considering the economic characteristics of the countries investigated. Linear regressions reveal that government consumption has a much bigger negative impact on long-run growth compared with the negative (and sometimes insignificant) effects of government debt. Nonlinear analyses further show that such effects are highly impacted by the economic characteristics of the countries investigated.
In the second essay, I study time-series fluctuations in the United States housing market from 2010 to 2016 using the Gordon growth model. Using variance decomposition analysis, I find that the housing premium is the main driver of housing market fluctuations. Motivated by previous studies and using impulse response functions, I show how different components of the housing market respond over time to a shock in the interest rate in regions with different levels of income or demographics. My findings suggest that the impact of monetary policy is smaller (and less persistent) in the U.S. housing market when households have more females, more African Americans, or fewer well-educated members; a combination of these demographics and a lower income in households results in a smaller impact of monetary policy in the housing market, due to the necessity of housing for these families.
In the third essay, I use Internal Revenue Service (IRS) annual data and Zillow median housing price data, to analyze the impact of income inequality on housing price to rent ratio from 2005 to 2015 for more than 12,700 zip codes. Employing various specifications, I find a consistent positive and significant relationship between the Gini coefficient and housing affordability index. My results are robust to different methods of estimating the Gini index. Moreover, the empirical results of this study suggest a larger impact of inequality in zip codes with higher levels of income.
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Stephens, Heather Marie. "Three Essays in Regional Economics." The Ohio State University, 2012. http://rave.ohiolink.edu/etdc/view?acc_num=osu1338575844.
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Zheng, Xian, and 郑贤. "Liquidity risk and asset pricing in the housing market." Thesis, The University of Hong Kong (Pokfulam, Hong Kong), 2013. http://hdl.handle.net/10722/193495.
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The role of liquidity in asset pricing model has attracted much attention in recent financial studies; however there is a paucity of literature with respect to liquidity risk and asset pricing in the direct housing market. The housing market is characterized by costly searching, inelastic supply and short-sale constraints. It is expected that the housing market should incur more significant illiquid effects, since it is much more illiquid than stock market. Motivated by this intuition, this thesis aims to explore 1) whether and to what extent liquidity can explain variations in over-time/crosssectional housing returns; and 2) whether liquidity factor plays a role in explaining the second moment (i.e. volatility) of housing price.
We employ the panel regression and Fama-MacBeth two-stage procedure to investigate over-time and cross-sectional relations between liquidity and housing return. Liquidity asset pricing theory suggests that assets with lower degree of liquidity offer higher expected returns. Consistent with this prediction, the panel regression results suggest that housing return is a decreasing function of liquidity in previous year, while it is positively relative to contemporary liquidity shocks. For the cross-sectional asset pricing tests, housing estate specific betas are estimated using rolling time-series regressions of a three-factor asset pricing model. We investigate the proposition that housing estates with greater return sensitivity to market liquidity earns higher expected return. Using a disaggregate dataset of 55 popular housing estates, we find (1) both market liquidity beta and housing estate specific liquidity risk are significantly priced in the cross-sectional housing estate returns, implying that cross-sectional differences in estate premium partially represent the liquidity premium. (2) The market beta, sentiment beta and market liquidity beta explain 14.36% of variations in cross-sectional estate returns. The results are robust across different specifications. (3) Investors are less willing to bear liquidity risk during the down markets, which shed new light on the positive price-volume correlation. These findings complement the cross-sectional liquidity-return relationship in the financial literature.
Measuring housing price volatility is fundamental to the study of the dynamics of housing price risk. We investigate the effects of liquidity on housing price volatility in different housing classes (classified by size of the housing unit according to the Rating and Valuation Department’s definitions). Housing price volatility is measured as the conditional variance of a GARCH model under the Adaptive Expectations framework. We reveal that volatility transmits from small housing units to large housing units, which indirectly supports the trade-up effect in previous literature.
Besides, the starter and high-end housing classes are extraordinarily sensitive to negative and positive liquidity shocks respectively. Consistent with the friction search theory, we find that the pricing errors are alleviated as the trading volume increases, since the valuated price tends to be more accurate as more information arrives. Lastly, the variance decomposition and impulse response results imply that the positive liquidity shock accounts for a large proportion of variations in housing volatility.<br>published_or_final_version<br>Real Estate and Construction<br>Doctoral<br>Doctor of Philosophy
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Eriksen, Michael Donald. "Supply-side housing subsidies and savings programs for the poor." Related electronic resource: Current Research at SU : database of SU dissertations, recent titles available, full text:, 2008. http://wwwlib.umi.com/cr/syr/main.
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Pinchbeck, Edward. "Empirical essays in the economics of health, housing, and the environment." Thesis, London School of Economics and Political Science (University of London), 2016. http://etheses.lse.ac.uk/3388/.
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This thesis is composed of four independent empirical essays that draw on and contribute to aspects of health, urban, public, and environmental economics. The chapters can be split into two distinct parts. The first part comprises two chapters that provide new quantitative evidence about the impacts of recent health care policies in the English National Health Service (NHS). While essentially describing policy evaluations, the essays provide insights into the underlying economic forces of health care demand and supply, and are linked to the urban economics literature by an explicit consideration of spatial issues. The second part comprises two further chapters that focus on a core urban economics topic — housing markets — placing particular emphasis on specific links between housing and environmental issues. The unifying theme, and overriding contribution, of the thesis is to bring fresh evidence to bear on policy-relevant issues in urban and public economics by the generation of new datasets and the application of econometric techniques.
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Österling, Anders. "Housing Markets and Mortgage Finance." Doctoral thesis, Stockholms universitet, Nationalekonomiska institutionen, 2017. http://urn.kb.se/resolve?urn=urn:nbn:se:su:diva-144622.
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This Ph.D. thesis deals with questions related to the housing market, and answers the questions: "Does it matter if housing markets are underpriced?" and "How do the legal system and the loan contract affect those who default on their mortgage payments? "When selling a home, a popular marketing strategy is to set the list price far below market value. The idea is that a low list price will attract loads of buyers, who will push up the sale price. This thesis finds that a voluntary reform can reduce underpricing in the short run. Further, underpriced housing markets do indeed require more attention from potential buyers during all stages — online, at open houses, and during the bidding. This extra search effort is costly to society. However, underpricing is found not to affect the sale price, the time to sell, who the buyers are, or how hard the real estate agent works. The household's choice to default on a mortgage depends on the cost of the default (the legal system) and the mortgage contract. By studying a heterogeneous agent consumption/savings lifecycle model, this thesis finds that households prefer "lender friendly" laws that are costly for the homeowners upon default. This is because costly defaults yield fewer defaulters and thus lower interest rates, and thus are cheaper for non-defaulters. Households always prefer non-amortizing mortgages except when defaults do not have any cost associated with them, and they prefer adjustable rates over fixed rates. The benefits of costly defaults are particularly large for non-amortizing mortgages. The thesis concludes with the development of a new mathematical method to solve a particular class of dynamic programming problems, using stochastic simulated grids and nearest-neighbour interpolation.
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Mathur, Shishir. "Effect of impact fees on housing prices : analysis of quality differentiated single family housing market of King County and Snohomish County, Washington /." Thesis, Connect to this title online; UW restricted, 2003. http://hdl.handle.net/1773/10799.
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Ozimek, Adam. "Sticky rents and the CPI for owner-occupied housing." Thesis, Temple University, 2013. http://pqdtopen.proquest.com/#viewpdf?dispub=3595699.
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<p> This dissertation examines the implications of sticky rents on the measurement of owner-occupied housing in the Consumer Price Index (CPI). I argue that marginal and not average rents are the most theoretically justified measurement of owners' equivalent rent (OER), and that the current measurement of rental inflation using average rents is methodologically incorrect. I then discuss the literature on sticky rents and tenure discounts and present a theoretical model showing the implications of sticky rents for aggregate measures of inflation. Then I use two new data sources to construct marginal rent measures to compare to average rent measures. The results show that marginal rents reflect market turning points sooner, and show a larger post-housing bubble decline in rents. In addition, marginal rents are shown to forecast overall inflation better than average rents. Finally, the implications of these results for policy are considered using the Taylor Rule for optimal monetary policy. The results present suggestive evidence that the impacts of switching to marginal rents may be large enough to significantly impact monetary policy and allow the Federal Reserve to be more responsive to both the boom and bust of housing bubbles.</p>