The economic implications of house price capitalization: a synthesis
In this article, I synthesize an emerging literature that explores the conditions under which public and private investments and intergovernmental transfers are capitalized into local house prices and the broader economic implications of such capitalization. The main insights are: (1) house price capitalization is more pronounced in locations with strict regulatory and geographical supply constraints; (2) capitalization can induce the provision of durable local public goods and club goods; and (3) capitalization effects?which are habitually ignored by policy-makers?have important adverse consequences for a wide range of policies such as intergovernmental aid and the mortgage interest deduction. ? 2015 American Real Estate and Urban Economics Association
1 July 2017
Real Estate Economics 45(2) , pp.301-339, 2017
https://onlinelibrary.wiley.com/doi/10.1111/1540-6229.12129
This Journal article is published under the centre's Urban programme.