The Impact of Population Ageing on House Prices:: A Micro-simulation Approach

Yu Chen, Kenneth Gibb, Chris Leishman, Robert Wright

Research output: Working paperDiscussion paper

6 Citations (Scopus)

Abstract

This paper attempts to estimate the impact of population ageing on house prices. There is considerable debate about whether population ageing puts downwards or upwards pressure on house prices. The empirical approach differs from earlier studies of this relationship, which are mainly regression analyses of macro time-series data. A micro-simulation methodology is adopted that combines a macro-level house price model with a micro-level household formation model. The case study is Scotland, a country that is expected to age rapidly in the future. The parameters of the household formation model are estimated with panel data from the British Household Panel Survey covering the period 1999-2008. The estimates are then used to carry out a set of simulations. The simulations are based on a set of population projections that represent a considerable range in the rate of population ageing. The main finding from the simulations is that population ageing—or more generally changes in age structure—is not likely a main determinant of house prices, at least in Scotland
LanguageEnglish
Place of PublicationGlasgow
PublisherUniversity of Strathclyde
Number of pages26
Publication statusPublished - Jun 2012

Publication series

NameStrathclyde Discussion Papers in Economics
PublisherUniversity of Strathclyde
No.12-07

Fingerprint

Population aging
House prices
Microsimulation
Simulation
Household formation
Scotland
Age structure
Population projections
Panel data
British Household Panel Survey
Methodology
Time series data

Keywords

  • impact
  • population ageing
  • house prices
  • micro-simulation approach

Cite this

Chen, Y., Gibb, K., Leishman, C., & Wright, R. (2012). The Impact of Population Ageing on House Prices: A Micro-simulation Approach. (Strathclyde Discussion Papers in Economics; No. 12-07). Glasgow: University of Strathclyde.
Chen, Yu ; Gibb, Kenneth ; Leishman, Chris ; Wright, Robert. / The Impact of Population Ageing on House Prices: A Micro-simulation Approach. Glasgow : University of Strathclyde, 2012. (Strathclyde Discussion Papers in Economics; 12-07).
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Chen, Y, Gibb, K, Leishman, C & Wright, R 2012 'The Impact of Population Ageing on House Prices: A Micro-simulation Approach' Strathclyde Discussion Papers in Economics, no. 12-07, University of Strathclyde, Glasgow.

The Impact of Population Ageing on House Prices: A Micro-simulation Approach. / Chen, Yu; Gibb, Kenneth; Leishman, Chris; Wright, Robert.

Glasgow : University of Strathclyde, 2012. (Strathclyde Discussion Papers in Economics; No. 12-07).

Research output: Working paperDiscussion paper

TY - UNPB

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AB - This paper attempts to estimate the impact of population ageing on house prices. There is considerable debate about whether population ageing puts downwards or upwards pressure on house prices. The empirical approach differs from earlier studies of this relationship, which are mainly regression analyses of macro time-series data. A micro-simulation methodology is adopted that combines a macro-level house price model with a micro-level household formation model. The case study is Scotland, a country that is expected to age rapidly in the future. The parameters of the household formation model are estimated with panel data from the British Household Panel Survey covering the period 1999-2008. The estimates are then used to carry out a set of simulations. The simulations are based on a set of population projections that represent a considerable range in the rate of population ageing. The main finding from the simulations is that population ageing—or more generally changes in age structure—is not likely a main determinant of house prices, at least in Scotland

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Chen Y, Gibb K, Leishman C, Wright R. The Impact of Population Ageing on House Prices: A Micro-simulation Approach. Glasgow: University of Strathclyde. 2012 Jun. (Strathclyde Discussion Papers in Economics; 12-07).