Demographic Factors and Real House Prices

21 Pages Posted: 11 Apr 2004 Last revised: 5 May 2021

See all articles by Richard K. Green

Richard K. Green

University of Southern California - Lusk Center for Real Estate

Patric H. Hendershott

University of Aberdeen - Centre for Property Research; National Bureau of Economic Research (NBER)

Date Written: April 1993

Abstract

Real house prices are directly determined by the willingness of households to pay for (and willingness of builders to supply) a constant-quality house. Changes in the quantity of housing demanded will affect real prices only to the extent that the long-run housing supply schedule is positively sloped. In this paper we use 1980 census data to measure the impact of the age structure and real income per household on the willingness of households to pay for a constant quality house. Extrapolating these variables forward to 2010, we conclude that evolving demographic forces are likely to raise real house prices. not lower them.

Suggested Citation

Green, Richard K. and Hendershott, Patric H., Demographic Factors and Real House Prices (April 1993). NBER Working Paper No. w4332, Available at SSRN: https://ssrn.com/abstract=287738

Richard K. Green (Contact Author)

University of Southern California - Lusk Center for Real Estate ( email )

2250 Alcazar Street
Los Angeles, CA 90089
United States

Patric H. Hendershott

University of Aberdeen - Centre for Property Research ( email )

Aberdeen AB24 2UF
Scotland

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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