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dc.contributor.authorHoffmann, Mathiasen_US
dc.contributor.authorKrause, Michael U.en_US
dc.contributor.authorLaubach, Thomasen_US
dc.description.abstractWe provide an analysis that might help distinguish rationally justified movements in house prices from potentially non-rational movements, using a two-sector business cycle model, in which investment in housing is subject to collateral constraints. A large portion of the evolution of U.S. house prices during the past 20 years can be reproduced when expectations of future income growth as published in surveys are used as an input into the model. Changes in growth expectations translate into corresponding changes in house prices, since the value of housing must be linked to expected aggregate income. Only since about 2005 do actual and model-implied house prices clearly diverge, calling for explanations not based on economic fundamentals.en_US
dc.publisherDeutsche Bundesbank Frankfurt a. M.en_US
dc.relation.ispartofseriesDiscussion Paper, Deutsche Bundesbank 12/2012en_US
dc.subject.keywordHouse pricesen_US
dc.subject.keywordtrend growthen_US
dc.subject.keywordKalman filteren_US
dc.subject.keywordreal-time dataen_US
dc.subject.keywordborrowing constraintsen_US
dc.titleTrend growth expectations and US house prices before and after the crisisen_US
dc.typeWorking Paperen_US
Appears in Collections:Discussion Papers, Deutsche Bundesbank

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