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Conventional and Macroprudential Policies: Impulse Response of House Price to Contractionary Monetary Policy and Loan-to-Value Shocks (one-standard-deviation shocks)
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This paper studies the interaction between the housing sector and the macroeconomic environment in Korea. Besides serving as a typical small open economy, Korea provides an interesting laboratory case, since the country was subject to various housing-cycle phases over the sample, and its policymakers implemented active policies to stabilize the hou...
Citations
... They observed that the impact of the macro economic variables on house prices were heterogeneous across the quantiles and in addition population had a significant positive effect across the quantiles. Conversely, Milani and Park, (2019) and Deng et al. (2018) opined that house prices are mostly explained by housing specific market attribute but not the fundamental and the role played by the fundamentals are minimal in South Korea and China respectively. Kok et al. (2018) by means of the SVAR model with focus on the macro -economic determinants of house prices and demand for houses in Malaysia, discovered using data dating from 2002Q1 to 2015Q4 that transaction volume and real house prices respond to most of the macro economic shocks. ...
This research systematically reviews and evaluate literature on the interplay of the macroeconomy and house prices in the contemporary. The research recapitulates the ï¬ndings, data and models between and among the discussants in the extant literature to unearth new research gaps. The study analyzed 64 papers from thousands of scholarly papers from purposively sampled reputable database from 2015 to March, 2020, using a systematic review methodology. Based on the inclusion and exclusion criteria, the selected papers were categorized in relation to the direction of the impact to showing the nexus on the topic. It found that: both the macroeconomy and house prices impact on each other. However, macroeconomic variables were noted to impact on house prices more frequently than the opposite. To the best of the authors knowledge, this review is the first in recent past, to unembellished the dynamic relationship between the macroeconomy and house prices based on the direction in the contemporary. Particularly in the era where there are so much conjectures in the market of another financial crises. The study makes a contribution by identifying new research opportunities for future research and has practical implications to policy makers, researchers and property investors.
Keywords: Macroeconomy, house prices, housing market, review.
JEL Classifications: E, O18
DOI: https://doi.org/10.32479/ijefi.10368
