INET Oxford's Prof John Muellbauer, together with Prof John Duca and Anthony Murphy of the Federal Reserve Bank of Dallas, has published a new VoxEU article which draws five lessons from a recent comprehensive survey on house price cycles.
Research on house price cycles and their interactions with the economy has burgeoned since the Global Financial Crisis. This column argues that conventional theories of house price dynamics are misleading. Shifts in credit conditions, together with differences in housing supply response across cities, regions and countries, account for much of the heterogeneity of house price outcomes. Finally, increased demand for space and unprecedented policy interventions together explain the very different house price experience in the pandemic compared with the Global Financial Crisis.
Read the full column on VoxEU: https://voxeu.org/article/what-drives-house-prices-some-lessons-literature
This is based on a 92 page survey in the Journal of Economic Literature which can be found here: https://ideas.repec.org/a/aea/jeclit/v59y2021i3p773-864.html