Demographic change and house prices: Headwind or tailwind?

- We empirically analyze the relationship between house prices and demographics.
- The overall effect of demographic change on house prices has been negative.
- The demographic downward pressure on house prices is likely to intensify.

Using a cross-country dataset for 13 developed economies spanning from 1950 to 2012, we argue that the overall effect of the demographic transition on house prices has been negative. Extrapolating the historical relationship into the future, demographic downward pressure on house prices is likely to intensify.