2021- Working Papers: Finance, Accounting and Insurance
Price dispersion and time-on-market in the housing market, 24 pp.
D. Ben-Shahar and R. Golan
(Working Paper no. 7/2021)
Research no.: 02220100
Imperfect and costly information generates price dispersion in the market. This study employs data on housing assets listed for sale on a leading online classified home service in Israel to assess the effect of quality-adjusted housing price dispersion on time-on-market. We develop a model by which we generate the hypothesis according to which increased price dispersion is associated with a decrease in the hazard of a sale. Based on survival analysis estimation, our empirical results provide evidence that the hazard rate of sale significantly decreases with quality-adjusted price dispersion. Results are robust to a series of model and sample specifications. As information reduces price dispersion in the market, our study supports the call for increased transparency and availability of information in real estate markets.
Can’t get there from here: Affordability distance to a superstar city, 38 pp.
D. Ben-Shahar, S. Gabriel and R. Golan
(Working Paper no. 8/2021)
Research no.: 02280100
This paper explores the housing affordability distance to a superstar city. Affordability distance is defined in terms of the increment to household income required to consume a quality- and consumption-adjusted housing unit in the proximate superstar city. The analysis focuses on Tel Aviv, Israel’s singular superstar city. Affordability distance to Tel Aviv rose by roughly 60 percent over the 2000 – 2015 period. Further, affordability distance was elevated among unmarried, non-college educated, and immigrant households. The upward movement in affordability distance was associated with increased out-migration from the city. Analysis of panel data suggests that policy interventions including investment in regional transportation infrastructure and new local housing supply were effective in mediating affordability distance.
