What forces drive the dynamic interaction between regional housing prices?

This paper examines the dynamic interaction between regional housing prices in the United States. We use the copula method to explore the dependent distribution of housing prices in ten metropolitan statistical areas (MSAs) in three regions. The results generally show that changes in time-varying co...

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Bibliographic Details
Published in:International journal of strategic property management 2017-09, Vol.21 (3), p.225-239
Main Authors: Wu, Yun-Ling, Lu, Chien-Lin, Chen, Ming-Chi, Chu, Fang-Ni
Format: Article
Language:English
Subjects:
Analysis
Copula model
Cost of living
Demography and human biology
Dynamic correlation
Economic development
Housing
Housing prices
Marketing / Advertising
Metropolitan statistical areas
Micro-Economics
Migration Studies
Regional housing prices
Regions
Rural and urban sociology
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Summary:This paper examines the dynamic interaction between regional housing prices in the United States. We use the copula method to explore the dependent distribution of housing prices in ten metropolitan statistical areas (MSAs) in three regions. The results generally show that changes in time-varying correlation result from different trends in regional housing prices. We regress housing price dynamic correlation on regional economic variables, finding that the economic co-movement mechanism determines the housing price correlation in the Western and Great Lakes regions, while the migration mechanism drives the housing price correlation in the Eastern region. We also find that economic co-movement is the main force driving the housing price correlation between regions.
ISSN:1648-715X
1648-9179
DOI:10.3846/1648715X.2016.1254120