This paper proposes a methodology for diagnosing and
predicting housing bubbles before they burst. The proposal is
implemented in two steps. In step 1 we apply three innovative
stock-bubbles tests to Canada’s provincial housing markets. This
allows us to classify provinces into three categories: those that
have not experienced any; those that have experienced in the
past; and those that are currently experiencing and may also
have experienced in the past episodes of bubble-like explosive
growth in the price-rent ratio. To determine whether explosive
growth in the latter two categories of provinces is the result of
changes in fundamentals or excessive speculation, in step 2 we
use the dating chronologies for explosive growth from step 1 and
probit models to evaluate the ability of many fundamentals to
predict future bubble formation.
Total Reviews: 0
After completion purchase and payment you will get an email with download link of book. You can download this book within 24 hours. Be remember you can't download this book after 24 hours.