Understanding Recent Trends in House Prices and Homeownership

Homeownership and the life cycle : an ordered logit approach ∗

This paper presents an ordered logit approach to model the optimal timing of buying a house in the life cycle. The model is applied to three recent Belgian household budget surveys. We find that households postpone homeownership or choose to be lifelong tenant due to an increase of the transaction tax rate, the real interest rate on mortgages and an indicator for the evolution of real house pri...

The equilibrium effect of fundamentals on house prices and rents

Using a dynamic equilibrium model of housing tenure choice with fully specified markets for homeownership and rental properties, and endogenous house prices and rents, this paper studies the effect of fundamentals on equilibrium house prices and rents. Lower interest rates, relaxed lending standards, and higher incomes are shown to account for approximately one-half of the increase in the U.S. ...

Online Appendices: Implications of U.S. Tax Policy for House Prices, Rents, and Homeownership

Your House Just Doubled in Value ?

the United States is increasingly becoming a country of homeowners. As reported recently by the Census bureau, close to 70 percent of households now own their primary residence. homeownership is no longer just an American dream; watering lawns, sweeping sidewalks and cleaning drain gutters is no longer the sole privilege of middle-income and affluent households. With the rise in the homeownersh...

The mortgage interest deduction and its impact on homeownership decisions

This paper examines the impact of the combined U.S. state and federal mortgage interest deduction (MID) on homeownership attainment, using data from 1984 to 2007 and exploiting variation in the subsidy arising from changes in the MID within and across states over time. We test whether capitalization of the MID into house prices offsets the positive effect on homeownership. We find that the MID ...