Cointegrations in house price dynamics and ageing population risks.

Autor: Cheung WM; Waseda Business School, Faculty of Commerce, Waseda University, Tokyo, Japan.
Jazyk: angličtina
Zdroj: PloS one [PLoS One] 2024 Feb 12; Vol. 19 (2), pp. e0296991. Date of Electronic Publication: 2024 Feb 12 (Print Publication: 2024).
DOI: 10.1371/journal.pone.0296991
Abstrakt: How does the riskiness of an ageing population change with house price dynamics of rural areas? Why do rural house prices increase faster than cities despite their ageing populations? Life cycle theory predicts working age households have higher demand for housing than retirement households. An issue that has seen much less attention in the literature is that rural house prices have been increasing despite their populations age rapidly. To answer these issues, our paper introduces an empirical cointegration-based framework designed to be flexible for empirical settings. Our cointegration framework reveals crucial information about rural housing and ageing which has not been found previously: the short-term deviation of house prices from cointegration restrictions is a strong predictor of future rural house prices and migration rate from 1 to 4 year ahead. This is not the case for urban areas nor where cointegration restrictions are being ignored. Rural house prices, not urban ones, are the key to understand this cointegration restriction. Our framework is pertinent to most ageing societies with available housing and demographic data. When a government formulates macroprudential policies internalizing these cointegration restrictions and supporting rural developments, migration into rural areas and population increases are possible. Our evidence highlights the importance of cointegration-based long-run ageing risks for rural housing markets.
Competing Interests: The authors have declared that no competing interests exist.
(Copyright: © 2024 William M. Cheung. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.)
Databáze: MEDLINE
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