Abstract
The article presents and illuminates evidence, based on recent Hong Kong experience, indicating the existence of a "housing ladder effect" when housing prices increase or decrease. An increase of housing equity at the bottom of the ladder tends to translate into a trading up activity that will both increase housing market turnover and buoy up the entire housing market. Based on a natural experiment through the introduction of a public housing privatization scheme, this article demonstrates the importance of the first step on the housing ladder using a logit model.
Original language | English |
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Pages (from-to) | 59-67 |
Number of pages | 9 |
Journal | Journal of Housing Economics |
Volume | 18 |
Issue number | 1 |
DOIs | |
Publication status | Published - 1 Mar 2009 |
Bibliographical note
We would like to thank Don Haurin, Francois Ortalo-Magne, Charles Leung, and two anonymous referees for valuable comments and suggestions on early versions of the paper.Funding
Support from the RGC Grants Committee of Hong Kong (LU3008/00H) is gratefully acknowledged.
Keywords
- Housing ladder
- Ladder effect
- Logit model
- Natural experiment
- Public housing privatization