Residential construction: using the urban growth model to estimate housing supply

Article Abstract:

A model of housing starts, 1975-1994, ties construction to changes in housing prices. The model is applicable to both national and regional data, and includes factors such as: interest rate changes, median months on market for existing stock, and material cost index.

Construction industry, Economic aspects, Supply and demand, Housing

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Housing, natural hazards, and insurance

Article Abstract:

Residential development and location choice within a community were characterized by the distance from the central business district and risk of loss due to future natural hazards of uncertain severity. An equilibrium model of housing markets was utilized to analyze the trade-off between exposure to loss and distance by determining the elementary properties of household demand and rents for housing services. The model was extended to allow households to trade off risk of loss and commuting costs in their choice of location. Results showed that it may be better for households to live at safer and more distant locations since locations within the interior of the city will be left undeveloped due to relatively substantial risks. It was also found that population growth contributes to residential development in hazardous areas.

Property & Liability Insurance, Direct Property and Casualty Insurance Carriers, Surety insurance, Analysis, Risk (Economics), Property and casualty insurance, Housing development, Natural disasters, Central business districts

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Intergenerational transfers, borrowing constraints, and saving behavior: evidence from the housing market

Article Abstract:

The impact of intergenerational transfers on saving and housing behavior was investigated by analyzing private wealth transfers targeted to first-time home purchases. Newly acquired household-level data from surveys of home buyers conducted by Chicago Title and Trust Co were examined in terms of accumulated savings, transfers received and time needed to save the down payment. Empirical results showed that intergenerational transfers significantly ease the borrowing constraint resulting from the down payment requirement and that transfer recipients reduce the time required to save for the down payment. In addition, transfer recipients increase the value of the home purchased by an amount that is substantially lower than if the transfer were fully leveraged. It was also found that the availability of intergenerational transfers reduces household savings.

Commercial Banks, Commercial Banking, Mortgage and Nonmortgage Loan Brokers, Consumer Mortgage Loans, Consumer Savings, Savings, Savings accounts, Mortgages, House buying, Home buying, Wealth

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