Housing Markets in a Pandemic: Evidence from Historical Outbreaks

37 Pages Posted: 7 Apr 2020 Last revised: 7 May 2020

See all articles by Marc Francke

Marc Francke

University of Amsterdam - Faculty of Economics and Business (FEB); Ortec Finance

Matthijs Korevaar

Maastricht University - Department of Finance

Date Written: May 6, 2020

Abstract

How do pandemics affect urban housing markets? This paper studies historical outbreaks of the plague in 17th-century Amsterdam and cholera in 19th-century Paris to answer this question. Based on micro-level transaction data, we show outbreaks resulted in large declines in house prices, and smaller declines in rent prices. We find particularly large reductions in house prices during the first six months of an epidemic, and in heavily-affected areas. However, these price shocks were only transitory, and both cities quickly reverted to their initial price paths. Our findings suggest these two cities were very resilient to major shocks originating from epidemics.

Keywords: pandemics, housing markets, asset prices, mortality

JEL Classification: G10, I19, J10, N93, R31

Suggested Citation

Francke, Marc and Korevaar, Matthijs, Housing Markets in a Pandemic: Evidence from Historical Outbreaks (May 6, 2020). Available at SSRN: https://ssrn.com/abstract=3566909 or http://dx.doi.org/10.2139/ssrn.3566909

Marc Francke

University of Amsterdam - Faculty of Economics and Business (FEB) ( email )

Plantage Muidergracht 12
Amsterdam, 1018 TV
Netherlands

HOME PAGE: http://www.uva.nl/en/contact/staff/item/m.k.francke.html?f=francke

Ortec Finance ( email )

Orly Centre
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Amsterdam, 1043 CP
Netherlands
+ 31 20 7009 700 (Phone)
+ 31 20 7009 701 (Fax)

HOME PAGE: http://www.ortec-finance.com

Matthijs Korevaar (Contact Author)

Maastricht University - Department of Finance ( email )

Tongersestraat 53
Maastricht, Limburg 6211 LM
Netherlands

HOME PAGE: http://sites.google.com/view/matthijskorevaar/home

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