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This study aims to construct alternative models to establish the dynamic relationship between exchange rates and housing affordability by estimating both the short- and long-run relationship between exchange rates and housing affordability for 18 OECD countries from 1975Q1 to 2022Q4. After that, this study demonstrates how this nexus behaves during high and low inflation regimes and turbulent times.

This study uses the panel autoregressive distributed lag technique to examine the nexus between housing affordability to capture the distinct characteristics of the sample countries and estimate various short- and long-run dynamics in the relationship between housing affordability and exchange rate.

Exchange rate appreciation improves housing affordability in the short run, whereas this connection tends to dissipate in the long run. Moreover, inflation can worsen housing affordability during turbulent times, such as the global financial crisis, in both the short and long run. Ignoring these changes in the relationship between exchange rates and housing affordability during turbulent times can lead to incorrect conclusions.

To the best of the authors’ knowledge, this study is the first to examine the association between exchange rates and housing affordability by demonstrating how these variables behave in high and low inflation regimes and turbulent times.

This paper aims to test the hedging ability of housing investment against inflation in Japan and the USA during the period 2000–2020.

This study applies the deep learning method and The exponential general autoregressive conditional heteroskedasticity in mean (1, 1) model with breaks.

Within the asymmetric framework, it is found that housing returns (HR) can hedge against inflation in both these markets, which mentions that when investing in the housing market in Japan and the USA, investors are compensated for bearing from inflation. This result is consistent with Fisher’s hypothesis. Especially, the empirical results show that the risk-return tradeoff is available in Japan’s housing market and not available in the US housing market. Any signal of a high inflation rate – referred to as “bad news” – may cause a drop in HR in Japan and a raise in the USA.

To the best of the author’s knowledge, this is one of the first studies using the deep learning method (long short-term memory model) to estimate the expected/unexpected inflation rates.

Human beings need shelter as the beginning of their existence. Same holds true for people who live in Turkey as it is a cultural and traditional reason to be the host and endeavor to buy a home even if one has to pay the debt for years. Another factor that is important for individuals and even for countries is the inflation rate. In this context, the purpose of this study is to investigate whether the 26 regions of Turkey are affected by the inflationary pressure, specifically in the housing price index (HPI).

For this purpose, data from 2010:01 to 2019:01 and the consumer price index (CPI), as well as HPI have been used. The causal relationship between the variables is analyzed by Konya Causality (2006) test.

The key results suggest that HPI causes inflationary pressures in some regions.

The study has some limitations in terms of data set and scope. These are as follows: although there are many variables affecting housing prices, this study aims to investigate the causal link between inflation and housing prices. In addition, only the CPI and HPI variables were provided on a monthly basis in the 2010-2019 period for 26 regions due to the aim of making regional propositions in the investigation of this relationship. For these reasons, different macroeconomic variables could not be studied.

This study makes the following contribution to the literature. While the majority of existing literature investigates the relationship between housing prices and inflation from an empirical perspective for country, very few studies have been for the sub-regions and also these studies have focused on only some sub-regions. In other words, in the literature review, a study has observed that Turkey has to examine the relationship between the housing price and inflation variables for all sub-regions in particular. To overcome this deficiency in the literature, this study aims to investigate the relationship between housing price and inflation for 26 regions.

This study aims to investigate whether changes in consumer interest rate, exchange rate and housing supply have permanent effects on housing inflation in Turkey.

For this purpose, data from 2010M01 to 2020M06 and changes in consumer interest rate, exchange rate, housing supply and housing inflation were used. Relationships between variables are analyzed first by the Granger causality tests and then the conditional frequency domain causality tests. The conditional frequency domain causality test specifically reveals the permanent causality between variables, whether there is a permanent effect.

According to the Granger causality test results, there are causality relationships from changes in the consumer interest rate and exchange rate to housing inflation. However, there is no causality relationship between housing supply and housing inflation. According to the conditional frequency domain causality test results, there is causality for the permanent and mid-term from changes in the consumer interest rate to housing inflation and causality for the mid-term and temporary from changes in the exchange rate to housing inflation. Additionally, it was found that there are causality relationships between changes in the consumer interest rate and changes in the exchange rate.

The first limit of the study is that only 2010M01-2020M06 months can be considered. Because the date that variables started common is 2010M01. Besides, there is a limit in the study in variables used. Many variables, both micro and macro, can be added to affect housing inflation.

Housing inflation is a remarkable issue in Turkey. There is an increase in the number of studies on the subject in recent years. For this reason, the study is trying to contribute by approaching the subject from a different angle. The most important contribution of the study is that it has not been investigated whether the determinants of housing inflation have permanent or temporary effects, which were not done in previous studies. In addition, the method used reveals how many months the effects of changes in exchange rates, consumer interest rates and housing supply on housing inflation last. Based on the findings obtained from the methods, important economic and political implications have been put forward in depth.

This study aims to extend the current literature by examining the inflation-hedging effectiveness of Malaysian residential property in the short run and long run. Malaysia is an emerging market and has some unique characteristics. Therefore, a dedicated study in this market is critical.

The analysis of this study involves two stages. The first stage is to estimate the inflation-hedging ability of Malaysian residential property in the short run. The Fama and Schwert model was employed. Thereafter, the long-run inflation-hedging effectiveness was assessed by using a dynamic ordinary least squares (DOLS) model.

The Fama and Schwert tests reveal that Malaysian residential property does provide some satisfactory hedge against the expected inflation component over the short run. However, variations are evident among different types of residential property. The DOLS results provide strong evidence to support that housing is an effective hedge against the expected inflation in the long run, whereas no comparable evidence is found for the unexpected inflation component.

The findings enable more informed and practical investment decision-making regarding the role of housing in inflation risk management.

This paper is the first study to offer empirical evidence of the inflation-hedging attributes of Malaysian residential property. Moreover, the inflation-hedging effectiveness of different types of residential property is also compared for the first time.

Over a long period, even low inflation has an impact on portfolio value and households’ purchasing power. In such a context, inflation hedging should remain an important issue for investors. In particular, long-term investors, who are concerned with the protection of their wealth, seek to hold effective hedging assets. This study aims to demonstrate that residential assets in “Grand Paris” are a hedge against inflation and particularly against its unexpected component.

In this study, the physical residential markets in 127 communes in Paris and the Parisian first-ring suburbs are considered as potential asset classes. We simplified the analysis by clustering the 127 communes into five homogenous groups using ascending hierarchical classification (AHC). Then, we test the hedging ability of these groups within a mixed asset portfolios using both correlation and regression analysis.

This paper presents an analysis of the “Grand Paris” housing market and its inflation hedging ability with comparison to other financial asset classes. Results show that the five housing groups act as a highly positive hedge against unexpected inflation. Furthermore, cash and bonds seem to provide, respectively, a partial and an over hedge against unexpected inflation. Stocks act as a perverse hedge against unexpected inflation and provide no significant hedge against expected inflation. Also, indirect listed real estate demonstrates little correlation with inflation, which makes us reject its hedging ability contrary to physical residential real estate.

The inflation topic: although several researches exist that question the hedging property of real estate, very few concentrate on physical residential assets and to the best of the authors’ knowledge, this study is the only one that targets the “Grand Paris” area. Residential assets of the “Grand Paris” communes are confirmed to be a hedge against inflation and particularly against its unexpected component thanks to its capital appreciation rather than income one. Also, we show that the listed real estate in France (Sociétés d’Investissement Immobilier Cotée) does not provide the same hedging properties contrary to the US real estate investment trusts (REITs) who demonstrate this ability. Listed real estate could thus not be used interchangeably with housing to protect from inflation in the French market.

Protection of investors against inflation and in particular in the face of its return to France in 2022. Reassuring promoters and investors of the interest of residential investment projects in “Greater Paris” and of the potential that this holds.

Inflation takes a chunk out of the purchasing power of money and thereby erodes the real value of people’s finance. Investors and households who seek protection from inflation erosion should invest in direct housing, and in particular within areas that are experiencing an effective metropolization process.

The originality of the study is precisely relative to the geographical area studied. The latter has experienced favorable economic conditions for several years and offers interesting fundamentals to explore and exploit in investment strategies that prove capable of protecting against imminent inflation. The database is specific to this project and has been built through the compilation of several sources and with the support of BNP Paribas Real Estate.

Cost of construction of residential properties as well as its subsequent rent trends remain a major challenge to stakeholders in the property rental markets of emerging economies. This study examined the relationship between housing construction costs and house rents fluctuations in Osogbo, Nigeria, to provide information for informed investment decisions.

The authors conducted a survey, where three sets of questionnaires were administered on building contractors; estate surveyors and valuers and private residential property owners. The data required comprise the estimated average construction costs and average market rents for two and three-bedroom bungalows in the study area from 2008 to 2018. These data were respectively sourced from all the 15 firms of building contractors and 25 firms of estate surveyors and valuers in Osogbo, Nigeria. Stratified random sampling was employed to select 180 property owners from three medium-density residential districts of Osogbo. Secondary data on macroeconomic variables were sourced from the Central Bank of Nigeria. Data collected were analysed using descriptive and inferential statistical tools.

The authors found a significant positive relationship (0.749) between construction costs and house rents trends; both variables maintained ascending trends. Construction costs and house rents inflation rates exhibited random fluctuations with the former having a higher mean inflation rate (10.47%). However, the difference was not statistically significant (p-value = 0.317 > 0.05). Respondents identified consumer price index (CPI) inflation among other macroeconomic variables as the strongest predictor of both construction costs and house rents fluctuations. However, evidence from further analysis of the time series suggested otherwise.

The result confirms construction cost as one of the vital supply factors of the housing market, which is often pass through to house rents. The positive relationship between construction costs and house rents trends should trigger new development which, will, in turn, allow rental housing investments to expand into new areas with prospects for profits that could be earned by domestic and foreign investors.

This study to the best knowledge of the researchers is the first to relate housing construction cost to house rent in Osogbo, Nigeria; thereby adding to the body of knowledge in this field.

The purpose of this paper is to examine the causal relationship between Chinese housing and stock markets. The authors discuss the three transmission mechanisms between the two markets: wealth effect, modern portfolio theory and credit-price effect. Moreover, the authors focus on the effects of inflation on the relationship between the two markets.

This paper uses wavelet analysis to test the housing and stock markets relationship both in the frequency domain and time domain.

The empirical results indicate that housing prices have a positive effect on stock prices, and these have the same effect on housing prices. Moreover, this positive effect means that stock prices have a wealth effect on housing prices and these have a credit-price effect on stock prices.

These results provide information to financial institutions and individual investors in China to assist them in constructing investment portfolios within these two asset markets.

The authors first use wavelet analysis to analyze Chinese housing and stock markets and to provide information both on the frequency domain and time domain. Moreover, the authors take the inflation factor as a control variable in the causal relationship between the housing and stock markets.

Empirical studies on household-level inflation inequality have so far only focused on periods with positive inflation rates. However, the major concern on the policy agenda since the most recent financial crisis has been deflation rather than inflation. This naturally raises the question regarding the effect of deflation on the distribution of real income when households spend their budget on different consumption bundles. This chapter compiles annual household-level inflation rates in Denmark from 1930 to 1935 based on microdata from the Expenditure and Saving Survey of 1931 and price data from the official Retail Price Index. The results indicate that lower-income households faced a larger decline in prices on their consumption of goods and services during the deflation years 1930–1932 than higher-income households did. The deflation thus contributed to narrowing the difference in real incomes between the top and bottom parts of the income distribution during the recession. In the years 1933–1935 with positive inflation rates, the lower-income households experienced higher inflation rates than higher-income households. Over the period 1930–1935 seen as a whole, the price development contributed slightly to reducing real income inequality. The low degree of medium-term persistence of differences in household-specific inflation rates is consistent with previous findings in various time periods from the 1960s to the 2000s without any persistent deflation events. The chapter at hand is the first empirical study of the direct distributional effects of price developments at the household level in a period with persistent deflation.

Residential property in a multi‐asset portfolio context has been considered from two substantially different perspectives: institutional investor's and the household's perspective. This paper constitutes the first of two related surveys on the role of residential property in a multi‐asset portfolio. The paper provides an introduction to housing property investment at a macro level and reviews the main empirical issues related to housing investment in an institutional portfolio context. The literature in this regard generally supports the evidence that residential property is a more effective hedge against inflation than both shares and bonds. Additionally, the reviewed studies generally report that unsecuritised housing investment not only generates risk‐adjusted returns comparable to those of bonds and shares, but also exhibits low levels of correlation with classic asset groups of institutional portfolios.