COVID-19 and Housing Prices: Australian Evidence with Daily Hedonic Returns

18 Pages Posted: 20 Jan 2021 Last revised: 12 Feb 2021

See all articles by Maggie Hu

Maggie Hu

The Chinese University of Hong Kong

Adrian D. Lee

Deakin University - Department of Finance (Property and Real Estate); Financial Research Network (FIRN)

Dihan Zou

University of North Carolina (UNC) at Chapel Hill

Date Written: February 12, 2021

Abstract

Using daily hedonic housing price index for five Australian capital cities, we document a negative relationship between prior COVID-19 cases and daily housing returns. Specifically, the daily housing return drops by 0.35 basis points or 1.26 percentage points annually for every doubling of newly confirmed COVID-19 cases in a state. We also examine the effect of government lockdown orders on housing returns and find insignificant results. These findings are robust to using total active COVID-19 cases and other model specifications. Overall, our paper contributes to the literature on the geographic spread of pandemics and real estate prices.

Suggested Citation

Hu, Maggie and Lee, Adrian D. and Zou, Dihan, COVID-19 and Housing Prices: Australian Evidence with Daily Hedonic Returns (February 12, 2021). Available at SSRN: https://ssrn.com/abstract=3768953 or http://dx.doi.org/10.2139/ssrn.3768953

Maggie Hu (Contact Author)

The Chinese University of Hong Kong ( email )

Cheng Yu Tung Building
12 Chak Cheung Street
Hong Kong, N.T.
Hong Kong

HOME PAGE: http://sites.google.com/site/maggiehuresearch/research

Adrian D. Lee

Deakin University - Department of Finance (Property and Real Estate) ( email )

70 Elgar Road
Melbourne, VIC 3125
Australia

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

HOME PAGE: http://www.firn.org.au

Dihan Zou

University of North Carolina (UNC) at Chapel Hill ( email )

102 Ridge Road
Chapel Hill, NC NC 27514
United States

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