Is Housing the Business Cycle? Evidence from U.S. Cities

Journal of Urban Economics, Vol. 67, No. 3, 2010

Federal Reserve Bank of St. Louis Working Paper No.2009-007B

38 Pages Posted: 10 Mar 2009 Last revised: 24 Nov 2011

See all articles by Andra C. Ghent

Andra C. Ghent

University of Utah - David Eccles School of Business

Michael Owyang

Federal Reserve Bank of St. Louis - Research Division

Date Written: July 23, 2009

Abstract

We analyze the relationship between housing and the business cycle in a set of 51 U.S. cities. Most surprisingly, we find that declines in house prices are often not followed by declines in employment. We also find that national permits are a better leading indicator for a city’s employment than a city’s own permits.

Keywords: local housing markets, residential investment, economic fluctuations, housing prices

JEL Classification: C32, E32, R11

Suggested Citation

Ghent, Andra C. and Owyang, Michael T., Is Housing the Business Cycle? Evidence from U.S. Cities (July 23, 2009). Journal of Urban Economics, Vol. 67, No. 3, 2010, Federal Reserve Bank of St. Louis Working Paper No.2009-007B, Available at SSRN: https://ssrn.com/abstract=1352671

Andra C. Ghent

University of Utah - David Eccles School of Business ( email )

1645 E Campus Center Dr
Salt Lake City, UT 84112-9303
United States

Michael T. Owyang (Contact Author)

Federal Reserve Bank of St. Louis - Research Division ( email )

411 Locust St
Saint Louis, MO 63011
United States

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