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Hot and cold seasons in the housing market

Ngai, L. Rachel and Tenreyro, Silvana ORCID: 0000-0002-9816-7452 (2013) Hot and cold seasons in the housing market. . London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

Every year housing markets in the United Kingdom and the United States experience systematic above-trend increases in both prices and transactions during the second and third quarters (the "hot season") and below-trend falls during the fourth and first quarters (the "cold season"). House price seasonality poses a challenge to existing models of the housing market. To explain seasonal patterns, this paper develops a matching model that emphasizes the role of match-specific quality between the buyer and the house and the presence of thick- market effects in housing markets. It shows that a small, deterministic driver of seasonality can be amplified and revealed as deterministic seasonality in transactions and prices, quantitatively mimicking the seasonal fluctuations in transactions and prices observed in the United Kingdom and the United States.

Item Type: Monograph (Working Paper)
Additional Information: © 2013 The Authors
Divisions: Economics
Centre for Economic Performance
Subjects: H Social Sciences > HC Economic History and Conditions
JEL classification: E - Macroeconomics and Monetary Economics > E0 - General
Date Deposited: 11 Nov 2013 12:28
Last Modified: 15 Sep 2023 23:29
URI: http://eprints.lse.ac.uk/id/eprint/54251

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