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The Swedish Housing Market, An Analysis of two Different Policy-Induced Shocks to the Swedish Fundamental House Prices

Lodén, Arvid LU and Persson, Johan LU (2019) NEKN01 20191
Department of Economics
Abstract
This paper presents an analysis of two different policy-induced shocks to the Swedish housing market. An abolishment of the interest deduction and a reintroduced property tax. The paper closely follows the methodology presented by Bergman and Sørensen (2016). This is a model that can be used to analyze the behavior of the estimated fundamental house prices and is suitable for various policy simulations. The sample period is between the first quarter of 1986 to last quarter of 2018. The main finding of this paper shows that the estimated fundamental house prices have increased sharply since the mid-1990s. Furthermore, some evidence states that the abolishment of the interest deduction will have a more substantial effect than the... (More)
This paper presents an analysis of two different policy-induced shocks to the Swedish housing market. An abolishment of the interest deduction and a reintroduced property tax. The paper closely follows the methodology presented by Bergman and Sørensen (2016). This is a model that can be used to analyze the behavior of the estimated fundamental house prices and is suitable for various policy simulations. The sample period is between the first quarter of 1986 to last quarter of 2018. The main finding of this paper shows that the estimated fundamental house prices have increased sharply since the mid-1990s. Furthermore, some evidence states that the abolishment of the interest deduction will have a more substantial effect than the reintroduced property tax on the forecasted fundamental house prices. (Less)
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author
Lodén, Arvid LU and Persson, Johan LU
supervisor
organization
course
NEKN01 20191
year
type
H1 - Master's Degree (One Year)
subject
keywords
Fundamental house prices, macroprudential policies, interest deduction, property tax
language
English
id
8989854
date added to LUP
2019-08-08 10:31:59
date last changed
2019-08-08 10:31:59
@misc{8989854,
  abstract     = {{This paper presents an analysis of two different policy-induced shocks to the Swedish housing market. An abolishment of the interest deduction and a reintroduced property tax. The paper closely follows the methodology presented by Bergman and Sørensen (2016). This is a model that can be used to analyze the behavior of the estimated fundamental house prices and is suitable for various policy simulations. The sample period is between the first quarter of 1986 to last quarter of 2018. The main finding of this paper shows that the estimated fundamental house prices have increased sharply since the mid-1990s. Furthermore, some evidence states that the abolishment of the interest deduction will have a more substantial effect than the reintroduced property tax on the forecasted fundamental house prices.}},
  author       = {{Lodén, Arvid and Persson, Johan}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{The Swedish Housing Market, An Analysis of two Different Policy-Induced Shocks to the Swedish Fundamental House Prices}},
  year         = {{2019}},
}