Australia's growth in households and house prices
| dc.contributor.author | Day, Creina | |
| dc.date.accessioned | 2025-05-12T05:03:39Z | |
| dc.date.available | 2025-05-12T05:03:39Z | |
| dc.date.issued | 2018-02 | |
| dc.description.abstract | Real house prices rise in Australia amid growing concern of an impending correction. This paper explains why the household formation rate has risen with strong population growth due to higher net immigration and average household size levelling of due to population ageing. An intertemporal model is developed to analyse the effect of an increase in the household formation rate on the housing market. We find that real house prices rise over time if the rate of household formation outstrips the rate of housing supply. Under forward looking expectations, a rising household formation rate could explain rising real house prices relative to the present discounted value of future wages. The results explain why real house prices may exhibit an upward trend despite population ageing and how government planning could have an impact. | |
| dc.identifier.uri | https://hdl.handle.net/1885/733750301 | |
| dc.language.iso | en_AU | |
| dc.provenance | The publisher permission to make it open access was granted in November 2024 | |
| dc.publisher | Crawford School of Public Policy, The Australian National University | |
| dc.relation.ispartofseries | Crawford School working papers | |
| dc.rights | Author(s) retain copyright | |
| dc.source.uri | https://crawford.anu.edu.au | |
| dc.title | Australia's growth in households and house prices | |
| dc.type | Working/Technical Paper | |
| dcterms.accessRights | Open Access | |
| dspace.entity.type | Publication | |
| local.type.status | Published Version |