Search and Liquidity in Single-Family Housing
REAL ESTATE ECONOMICS Vol. 24 No. 3
Posted: 25 Jun 1998
Abstract
A two-stage least squares model of housing prices is estimated with data collected from 3358 single-family home transactions. The results provide evidence for an optimal marketing period and indicate that a liquidity premium is priced in single-family home sales. Consistent with the hypothesis derived from economic search models, the model shows higher selling prices for houses having longer expected marketing periods. The model also shows a price premium for houses that sell faster than expectations. This effect supports the concept that liquidity is a value- enhancing characteristic.
JEL Classification: G14, R31
Suggested Citation: Suggested Citation
Forgey, Fred A. and Rutherford, Ronald C. and Springer, Thomas M., Search and Liquidity in Single-Family Housing. REAL ESTATE ECONOMICS Vol. 24 No. 3, Available at SSRN: https://ssrn.com/abstract=9075
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