Housing Cycles in the Major Euro Area Countries

38 Pages Posted: 5 Apr 2010 Last revised: 9 May 2015

See all articles by Luis J. Álvarez

Luis J. Álvarez

Banco de España

Guido Bulligan

Bank of Italy

Alberto Cabrero

Banco de España

Laurent Ferrara

Banque de France

Harald Stahl

Deutsche Bundesbank - Economics Department

Date Written: March 31, 2010

Abstract

The recent burst of the house price bubble in the United States and its spillover effects on real economies worldwide has rekindled the interest in the role of housing in the business cycle. In this paper, we investigate the relationships between housing cycles among the four major euro area countries (Germany, France, Italy and Spain) over the sample 1980Q1-2008Q4. Our main findings are that GDP cycles show a high degree of comovement across these four countries, reflecting trade linkages, but much weaker ones for housing market cycles, where idiosyncratic factors play a major role. House prices are even less related than quantities across countries. We also find much stronger relationships in the common monetary policy period.

Keywords: Housing cycles, synchronisation measures, euro area countries

JEL Classification: E32, R21, R32

Suggested Citation

Álvarez, Luis J. and Bulligan, Guido and Cabrero, Alberto and Ferrara, Laurent and Stahl, Harald, Housing Cycles in the Major Euro Area Countries (March 31, 2010). Banco de Espana Occasional Paper No. 1001. Available at SSRN: https://ssrn.com/abstract=1582354 or http://dx.doi.org/10.2139/ssrn.1582354

Luis J. Álvarez (Contact Author)

Banco de España ( email )

Madrid 28014
Spain

Guido Bulligan

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Alberto Cabrero

Banco de España ( email )

Madrid 28014
Spain

Laurent Ferrara

Banque de France ( email )

Paris
France

Harald Stahl

Deutsche Bundesbank - Economics Department ( email )

Wilhelm-Epstein-Strasse 14
60431 Frankfurt am Main
Germany

Register to save articles to
your library

Register

Paper statistics

Downloads
84
Abstract Views
1,090
rank
298,769
PlumX Metrics