House Price Synchronicity, Banking Integration, and Global Financial Conditions

We examine the relationship between house price synchronicity and global financial conditions across 40 countries and about 70 cities over the past three decades. The role played by cross-border banking flows in residential property markets is examined as well. Looser global financial conditions are...

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Bibliographic Details
Main Author: Alter, Adrian
Other Authors: Dokko, Jane, Seneviratne, Dulani
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2018
Series:IMF Working Papers
Subjects:
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
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653 |a Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data) 
653 |a Finance 
653 |a Asset and liability management 
653 |a International liquidity 
653 |a Global Financial Crisis, 2008-2009 
653 |a International Policy Coordination and Transmission 
653 |a International finance 
653 |a Currency 
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653 |a Global financial crisis of 2008-2009 
653 |a Financial Crises 
653 |a Foreign Exchange 
653 |a Investment Decisions 
653 |a Housing prices 
653 |a Business cycles 
653 |a International Business Cycles 
653 |a Economic growth 
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520 |a We examine the relationship between house price synchronicity and global financial conditions across 40 countries and about 70 cities over the past three decades. The role played by cross-border banking flows in residential property markets is examined as well. Looser global financial conditions are associated with greater house price synchronicity, even after controlling for bilateral financial integration. Moreover, we find that synchronicity across major cities may differ from that of their respective countries', perhaps due to the influence of global investors on local house price dynamics. Policy choices such as macroprudential tools and exchange rate flexibility appear to be relevant for mitigating the sensitivity of domestic housing markets to the rest of the world