학술논문
Here Lives a Wealthy Man: Price Rigidity and Predictability in Luxury Housing Markets
Document Type
redif-paper
Author
Source
International School of Economics at TSU, Tbilisi, Republic of Georgia, Working Papers.
Subject
Language
English
Abstract
We use novel and unique data to study the effect of price changes in the market for luxury and middle class homes. We find that luxury home sales respond less to price changes than the middle-class home sales; in the market for luxury homes, past prices affect current prices; luxury home prices persist; and prices of luxury homes are stickier than prices of middle-class homes. Recent macroeconomic models predict that housing markets can have counter-cyclical effect, if home prices are flexible. Our findings imply that home prices, especially luxury home prices, may not be flexible enough to generate such effect.