Residential House Price Inflation Euro Area / US
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Fannie and Freddie on the rope
17.07.2008
By: Wolfgang Münchau
When house price are expected to decline by 30%, some strange things are happening
Global liquidity drives house prices
17.04.2008
By: Ansgar Belke, University of Essen, IZA Bonn and ECB Observer group
Loose monetary policy and ample global liquidity have significantly contributed to the bull market in the real estate sector in OECD countries. By contrast, the reaction speed of consumer prices to the same shock is much lower, though clearly significant in the long run. This suggests that strong money growth might be a good indicator of emerging future bubbles in the real estate sector and that house prices might well serve as indicators of future inflationary pressures on goods markets.
Central banks must care about asset prices
08.04.2008
By: Wolfgang Münchau
The IMF is right to say that asset price matter for monetary policy. But the IMF is wrong to claim that this would be consistent with inflation targeting.
House prices have 30-40% more to fall
06.04.2008
By: Wolfgang Münchau
Here is an interview with me on CNBC on the housing market situation in western Europe and the US.
28.09.2007 The end of the Irish boom
24.09.2007 The coming house price crash in Europe
14.09.2007 What has gotten into Mervyn King?
13.09.2007 A response to Alan
03.09.2007 Prepare for the credit crisis to spread
28.08.2007 Cracks in the Foundations of Growth
30.05.2007 The Economics behind the Irish Elections
Eurointelligence Briefing Notes
Is there a house price bubble in the Euro Area?
Some of the big questions facing the US at the moment is the extent of the housing recession, and the implication for the wider economy. Another issue is whether the US housing recession will spill over into the euro area. In the past, housing shocks were transmitted across the Atlantic. Will it happen again?The first thing to note is that there is a high correlation between house prices in the US and in Europe, and especially with France and Spain. In a recent analysis, Deutsche Bank producing a scoring model to identify the sensitivity of European house prices to change in US house prices, and concluded that Ireland and Spain are most vulnerable to a slowdown in US housing. They conclude that any bad news from the world economy will not be compensated by housing, as happened in 2001,...