Derivatives Markets for Home Prices

27 Pages Posted: 23 Apr 2008 Last revised: 27 Aug 2010

See all articles by Robert J. Shiller

Robert J. Shiller

Yale University - Cowles Foundation; National Bureau of Economic Research (NBER); Yale University - International Center for Finance

Multiple version iconThere are 2 versions of this paper

Date Written: April 2008

Abstract

The establishment recently of risk management vehicles for home prices is described. The potential value of such vehicles, once they become established, is seen in consideration of the inefficiency of the market for single family homes. Institutional changes that might derive from the establishment of these new markets are described. An important reason for these beginnings of real estate derivative markets is the advance in home price index construction methods, notably the repeat sales method, that have appeared over the last twenty years. Psychological barriers to the full success of such markets are discussed.

Suggested Citation

Shiller, Robert J., Derivatives Markets for Home Prices (April 2008). NBER Working Paper No. w13962. Available at SSRN: https://ssrn.com/abstract=1122750

Robert J. Shiller (Contact Author)

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Yale University - International Center for Finance ( email )

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