Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5089994 | Journal of Banking & Finance | 2010 | 7 Pages |
Abstract
This paper looks at recent developments in house purchase loans and house prices in Spain and the linkages between them. It aims at identifying deviations of these variables from their equilibrium levels, and for this purpose, we estimate a vector error-correction model. The results show that both variables are interdependent in the long-run and that both variables were above their equilibrium level by the end of the sample period (2009:Q1). The paper also offers insight into how overvaluation (overindebtedness) in house prices can lead to a false sense of no overindebtedness (house prices overvaluation).
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Ricardo Gimeno, Carmen MartÃnez-Carrascal,