EU housing markets before financial crisis of 2008: The role of institutional factors and structural breaks

• Published in: Journal of housing and the built environment Vol. 36; no. 3; pp. 867 - 899
• Main Authors: Martins, António Miguel, Serra, Ana Paula, Martins, Francisco Vitorino, Stevenson, Simon
• Format: Journal Article
• Language: English
• Published: Dordrecht Springer Netherlands 01-09-2021; Springer Nature B.V
• Subjects: Credit policy; Economic crisis; Geography; Housing; Housing costs; Housing market; Housing prices; Human Geography; Landscape/Regional and Urban Planning; Organizational aspects; Policy making; Prices; Pricing; Social Sciences; European union; Structural breaks; Institutional factors; Mortgage market; Housing market
• ISSN: 1566-4910; 1573-7772
• DOI: 10.1007/s10901-021-09848-7

We study if and how the structure of EU housing markets, particularly the role of structural breaks and the institutional characteristics of national residential mortgage markets across the EU countries affects the EU housing prices before the financial crisis of 2008. We document three main features: first, the institutional characteristics of residential mortgage markets differ markedly across EU countries; second, and according to a wide range of indicators, the increase of housing prices is significantly stronger in those countries where the credit policy characteristics are less conservative; third, for the majority of EU countries, we find evidence of structural breaks in EU housing markets that often coincide with a housing market policy change.