publication . Article . Preprint . 2012

A Structural Model for the Housing and Credit Markets in Italy

Francesco Zollino; Andrea Nobili;
Open Access
  • Published: 01 Oct 2012 Journal: SSRN Electronic Journal (eissn: 1556-5068, Copyright policy)
  • Publisher: Elsevier BV
Abstract
We estimate a fully-fledged structural system for the housing market in Italy, taking into account the multi-fold link with bank lending to both households and construction firms. The model allows the house supply to vary in the short run and the banking sector to affect the equilibrium in the housing market, through its effect on housing supply and demand. We show that house prices react mostly to standard drivers such as disposable income, expected inflation and demographic pressures. Lending conditions also have a significant impact, especially through their effects on mortgage loans, and consequently on housing demand. Allowing short-run adjustment in house ...
Subjects
free text keywords: house prices, credit, system of simultaneous equations, Deleveraging, Monetary policy, Monetary economics, Economics, Banking sector, Financial crisis, House price, Supply and demand, Macroeconomics, jel:E51, jel:E52, jel:G21
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