Property Prices and Speculative Bubbles: Evidence from Hong Kong Sar

29 Pages Posted: 30 Jan 2006

See all articles by Sanjay Kalra

Sanjay Kalra

International Monetary Fund (IMF) - Asia and Pacific Department

Dubravko Mihaljek

Bank for International Settlements (BIS) - Monetary and Economic Department

Christoph K. Duenwald

International Monetary Fund (IMF)

Date Written: January 2000

Abstract

This paper examines the determinants of residential property prices in Hong Kong SAR during 1980-98. It uses time-series analysis techniques to characterize price developments, establish empirical regularities, and provide measures of the deviations of actual price changes from trend. The analysis suggests that at the peak of the boom, in mid-1997, the level of property prices may have been 40-45 percent above levels suggested by developments in fundamentals. The analysis highlights the role of demand-side factors, and the data are not inconsistent with the notion that the property market may be subject to speculative bubbles.

Keywords: Hong Kong SAR, property prices, speculative bubbles

JEL Classification: G12, E31, C32

Suggested Citation

Kalra, Sanjay and Mihaljek, Dubravko and Duenwald, Christoph K., Property Prices and Speculative Bubbles: Evidence from Hong Kong Sar (January 2000). IMF Working Paper No. 00/2, Available at SSRN: https://ssrn.com/abstract=879304

Sanjay Kalra (Contact Author)

International Monetary Fund (IMF) - Asia and Pacific Department ( email )

700 19th Street NW
Washington, DC 20431
United States

Dubravko Mihaljek

Bank for International Settlements (BIS) - Monetary and Economic Department ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland

Christoph K. Duenwald

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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