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- Title
Housing Starts, 1966 and 1969: A Comparison Using an Econometric Model.
- Authors
Burnham, James B.
- Abstract
The performance of the housing starts in 1966 and 1969 has aroused considerable interest. During both periods, similar pressures were at work in the nation's financial markets: interest rates rose rapidly and flows of funds to depositary institutions dropped substantially. This article uses a well-known econometric model of the housing market to investigate the reasons for the significantly different behavior in housing starts during these two periods. Relatively high vacancy rates in 1966 were largely responsible for the greater decline in housing starts during that period as opposed to 1969. Adverse financial trends were present in roughly equal intensity in both periods. The study suggests that while variations in the flow of financing through depositary institutions are important factors in generating the housing "cycle", basic demand factors will tend to put a floor to cyclical troughs and the extent of the decline from the peak to trough is strongly influenced by the vacancy level at the peak.
- Subjects
UNITED States; HOUSING starts; ECONOMIC indicators; HOUSING market; PUBLIC depositaries; ECONOMETRIC models; HOUSING
- Publication
Land Economics, 1972, Vol 48, Issue 1, p88
- ISSN
0023-7639
- Publication type
Article
- DOI
10.2307/3145648