Determinants of House Prices in Central and Eastern Europe

31 Pages Posted: 25 Sep 2007

See all articles by Balázs Égert

Balázs Égert

Organization for Economic Co-Operation and Development (OECD); CESifo (Center for Economic Studies and Ifo Institute); Université Paris X Nanterre - Department of Economics; William Davidson Institute

Dubravko Mihaljek

Bank for International Settlements (BIS) - Monetary and Economic Department

Date Written: November 2007

Abstract

This paper studies the determinants of house prices in eight transition economies of central and eastern Europe (CEE) and 19 OECD countries. The main question addressed is whether the conventional fundamental determinants of house prices, such as GDP per capita, real interest rates, housing credit and demographic factors, have driven observed house prices in CEE. We show that house prices in CEE are determined to a large extent by the underlying conventional fundamentals and some transition-specific factors, in particular institutional development of housing markets and housing finance and quality effects.

Keywords: House prices, housing market, transition economies, central and eastern Europe, OECD countries

JEL Classification: E20, E39, P25, R21, R31

Suggested Citation

Egert, Balazs and Mihaljek, Dubravko, Determinants of House Prices in Central and Eastern Europe (November 2007). BIS Working Paper No. 236, CESifo Working Paper Series No. 2152, William Davidson Institute Working Paper No. 894, Available at SSRN: https://ssrn.com/abstract=1014555

Balazs Egert (Contact Author)

Organization for Economic Co-Operation and Development (OECD) ( email )

2 rue Andre Pascal
Paris Cedex 16, 75775
France

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Université Paris X Nanterre - Department of Economics

Nanterre Cedex, 92001
France

William Davidson Institute

724 E. University Ave.
Wyly Hall
Ann Arbor, MI 48109-1234
United States

Dubravko Mihaljek

Bank for International Settlements (BIS) - Monetary and Economic Department ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland

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