Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/61501
Title: Does liquidity affect housing market performance? An empirical study with spatial panel approach
Authors: Zheng, X
Hui, ECM 
Keywords: Housing price
Liquidity
Spatial panel model
Spatial spillover
Issue Date: 2016
Publisher: Pergamon Press
Source: Land use policy, 2016, v. 56, p. 189-196 How to cite?
Journal: Land use policy 
Abstract: This paper investigates the spatial effects of liquidity factors on housing market performance. We adopt the spatial panel approach to address spatial dependency and the spillover effect among neighboring housing estates. Using a special transaction database from the Economic Property Research Centre (EPRC), the results show that a higher housing liquidity level leads to a lower subsequent housing return, while the contemporary return increases with unexpected liquidity shock. Specifically, a 1% rise in the housing liquidity level leads to a 1.85% fall in the expected housing return in the following year, and a 1% unexpected liquidity shock would raise the contemporary housing return by 3.33%. Moreover, the results reveal strong spatial spillover effects of liquidity shocks in the Hong Kong housing market. This paper delivers useful implications for both policy makers and practitioners regarding spatial dependency and contagion among housing markets. The research framework and spatial approaches can be easily replicated and applied to other cities and regions.
URI: http://hdl.handle.net/10397/61501
ISSN: 0264-8377
DOI: 10.1016/j.landusepol.2016.05.008
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