Addae-Dapaah, K;
(2014)
Housing Loan and the Price of Housing in Singapore.
Journal of Business and Economics
, 5
(9)
pp. 1513-1524.
10.15341/jbe(2155-7950)/09.05.2014/007.
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Abstract
We use the Johansen co-integration test and the Vector Error Correction Model (VECM) to analyze data on housing loan, housing price, interest rate and GDP from 19911Q to 20102Q to particularly ascertain the extent to which housing loan affects house prices in Singapore. The results show the existence of a long run co-integration among housing loan, house price, interest rate and GDP. Furthermore, housing loan is found to be positively correlated with house price and GDP but negatively correlated with interest rate in the long run. There seems to be no correlation between housing loan and house price in the short run. Moreover, a change in housing loan per se does not affect house price, neither does a change in house price per se affect housing loan in the short run. Thus, while there is long run equilibrium among housing loan, house price, interest rate and GDP, the causality direction between housing loan and house price is somewhat obscure. This implies that targeting housing loan as a means to control property price inflation in Singapore may not achieve the immediate desired result.
| Type: | Article |
|---|---|
| Title: | Housing Loan and the Price of Housing in Singapore |
| Open access status: | An open access version is available from UCL Discovery |
| DOI: | 10.15341/jbe(2155-7950)/09.05.2014/007 |
| Publisher version: | http://www.academicstar.us/issueshow.asp?daid=925 |
| Language: | English |
| Additional information: | Copyright © Academic Star Publishing Company, 2014. |
| Keywords: | housing loan; housing price; Johansen test; vector error correction model; correlation |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices UCL > Provost and Vice Provost Offices > UCL BEAMS UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment > The Bartlett School of Planning |
| URI: | https://discovery.ucl.ac.uk/id/eprint/1503371 |
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