REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE?
Autor(a) principal: | |
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Data de Publicação: | 2017 |
Outros Autores: | , , |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | RAM. Revista de Administração Mackenzie |
Texto Completo: | http://old.scielo.br/scielo.php?script=sci_arttext&pid=S1678-69712017000200211 |
Resumo: | ABSTRACT Purpose: To analyze the real estate sector of a Brazilian metropolis in the recent period of great valuation of the asset in the country and to investigate if there are signs of a speculative bubble in this market. Originality/gap/relevance/implications: This article presents a version of the Case-Shiller Index, which describes the evolution of the relationship between house prices and rental prices and uses models in order to identify if the rise in property prices rests on good economic fundamentals. Key methodological aspects: The approach is quantitative and involves the construction of the price-rent index, unit root test with an instrument that allows structural break with trend (Innovation Outlier Model) and analysis of cointegration using estimates of a Vector Error Correction Model (VECM). Summary of the results: The results do not favor the interpretation that the real estate market rests on solid economic fundamentals. On the contrary, the evolution of the price-rent index and the lack of causal relationship of rents to prices towards long-term equilibrium are suggestive of the existence of a speculative bubble. Key considerations/conclusions: The results support authors who are critical to the efficient market hypothesis (EMH) and suggest that the relative increase in property prices stems only from the belief that their selling price will be higher in the future. It is therefore foreseeable a decrease of real prices of housings, with equity losses for the participants in that market. |
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REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE?Real estate marketSpeculative bubbleFinancial crisisIndex Price-to-RentVECMABSTRACT Purpose: To analyze the real estate sector of a Brazilian metropolis in the recent period of great valuation of the asset in the country and to investigate if there are signs of a speculative bubble in this market. Originality/gap/relevance/implications: This article presents a version of the Case-Shiller Index, which describes the evolution of the relationship between house prices and rental prices and uses models in order to identify if the rise in property prices rests on good economic fundamentals. Key methodological aspects: The approach is quantitative and involves the construction of the price-rent index, unit root test with an instrument that allows structural break with trend (Innovation Outlier Model) and analysis of cointegration using estimates of a Vector Error Correction Model (VECM). Summary of the results: The results do not favor the interpretation that the real estate market rests on solid economic fundamentals. On the contrary, the evolution of the price-rent index and the lack of causal relationship of rents to prices towards long-term equilibrium are suggestive of the existence of a speculative bubble. Key considerations/conclusions: The results support authors who are critical to the efficient market hypothesis (EMH) and suggest that the relative increase in property prices stems only from the belief that their selling price will be higher in the future. It is therefore foreseeable a decrease of real prices of housings, with equity losses for the participants in that market.Editora MackenzieUniversidade Presbiteriana Mackenzie2017-04-01info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersiontext/htmlhttp://old.scielo.br/scielo.php?script=sci_arttext&pid=S1678-69712017000200211RAM. Revista de Administração Mackenzie v.18 n.2 2017reponame:RAM. Revista de Administração Mackenzieinstname:Universidade Presbiteriana Mackenzie (UPM)instacron:MACKENZIE10.1590/1678-69712016/administracao.v18n2p211-236info:eu-repo/semantics/openAccessLOCATELLI,RONALDO LAMOUNIERINÊS,HAROLDO MARCIOLARA,JOSÉ EDSONNOGUEIRA,FERNANDO TADEU PONGELUPEeng2017-06-12T00:00:00Zoai:scielo:S1678-69712017000200211Revistahttps://www.scielo.br/j/ram/https://old.scielo.br/oai/scielo-oai.phprevista.adm@mackenzie.br1678-69711518-6776opendoar:2017-06-12T00:00RAM. Revista de Administração Mackenzie - Universidade Presbiteriana Mackenzie (UPM)false |
dc.title.none.fl_str_mv |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
title |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
spellingShingle |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? LOCATELLI,RONALDO LAMOUNIER Real estate market Speculative bubble Financial crisis Index Price-to-Rent VECM |
title_short |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
title_full |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
title_fullStr |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
title_full_unstemmed |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
title_sort |
REAL ESTATE MARKET OF A BRAZILIAN METROPOLIS: SUSTAINED GROWTH OR SPECULATIVE BUBBLE? |
author |
LOCATELLI,RONALDO LAMOUNIER |
author_facet |
LOCATELLI,RONALDO LAMOUNIER INÊS,HAROLDO MARCIO LARA,JOSÉ EDSON NOGUEIRA,FERNANDO TADEU PONGELUPE |
author_role |
author |
author2 |
INÊS,HAROLDO MARCIO LARA,JOSÉ EDSON NOGUEIRA,FERNANDO TADEU PONGELUPE |
author2_role |
author author author |
dc.contributor.author.fl_str_mv |
LOCATELLI,RONALDO LAMOUNIER INÊS,HAROLDO MARCIO LARA,JOSÉ EDSON NOGUEIRA,FERNANDO TADEU PONGELUPE |
dc.subject.por.fl_str_mv |
Real estate market Speculative bubble Financial crisis Index Price-to-Rent VECM |
topic |
Real estate market Speculative bubble Financial crisis Index Price-to-Rent VECM |
description |
ABSTRACT Purpose: To analyze the real estate sector of a Brazilian metropolis in the recent period of great valuation of the asset in the country and to investigate if there are signs of a speculative bubble in this market. Originality/gap/relevance/implications: This article presents a version of the Case-Shiller Index, which describes the evolution of the relationship between house prices and rental prices and uses models in order to identify if the rise in property prices rests on good economic fundamentals. Key methodological aspects: The approach is quantitative and involves the construction of the price-rent index, unit root test with an instrument that allows structural break with trend (Innovation Outlier Model) and analysis of cointegration using estimates of a Vector Error Correction Model (VECM). Summary of the results: The results do not favor the interpretation that the real estate market rests on solid economic fundamentals. On the contrary, the evolution of the price-rent index and the lack of causal relationship of rents to prices towards long-term equilibrium are suggestive of the existence of a speculative bubble. Key considerations/conclusions: The results support authors who are critical to the efficient market hypothesis (EMH) and suggest that the relative increase in property prices stems only from the belief that their selling price will be higher in the future. It is therefore foreseeable a decrease of real prices of housings, with equity losses for the participants in that market. |
publishDate |
2017 |
dc.date.none.fl_str_mv |
2017-04-01 |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://old.scielo.br/scielo.php?script=sci_arttext&pid=S1678-69712017000200211 |
url |
http://old.scielo.br/scielo.php?script=sci_arttext&pid=S1678-69712017000200211 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
10.1590/1678-69712016/administracao.v18n2p211-236 |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.format.none.fl_str_mv |
text/html |
dc.publisher.none.fl_str_mv |
Editora Mackenzie Universidade Presbiteriana Mackenzie |
publisher.none.fl_str_mv |
Editora Mackenzie Universidade Presbiteriana Mackenzie |
dc.source.none.fl_str_mv |
RAM. Revista de Administração Mackenzie v.18 n.2 2017 reponame:RAM. Revista de Administração Mackenzie instname:Universidade Presbiteriana Mackenzie (UPM) instacron:MACKENZIE |
instname_str |
Universidade Presbiteriana Mackenzie (UPM) |
instacron_str |
MACKENZIE |
institution |
MACKENZIE |
reponame_str |
RAM. Revista de Administração Mackenzie |
collection |
RAM. Revista de Administração Mackenzie |
repository.name.fl_str_mv |
RAM. Revista de Administração Mackenzie - Universidade Presbiteriana Mackenzie (UPM) |
repository.mail.fl_str_mv |
revista.adm@mackenzie.br |
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1752128649780264960 |