Overviews the conditions which are necessary for a futures market in housing. Indicates some ways in which the new market might be used. Examines whether a national price index would benefit hedgers in different regions. Discusses the role intermediaries such as building societies and banks would have in the new market. Considers whether there are ways of “streamlining” house transactions which would be simpler than futures trading. Concludes that a futures market could succeed if banks and building societies offered insurance to purchasers, offsetting the risk on the futures market. Suggests that such a system could dramatically reduce the cost of “chain breaking”.
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