城市经济学英文课件 (16)
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– Costly upgrade of old dwelling – New house with new materials, technology,
fashion – Used house filtered down from higher level
• Filtering: Income level of occupant decreases over time
1.65 • Externalities from abandoned buildings: Eyesores
and crime havens
14-1111
Durability and Supply Elasticity
• Increase in price of housing increases quantity supplied
• Most of the stock (97% - 98%) is used • Rate of deterioration relatively slow • Upgrading (Remodel & renovate) costly, so large
price hike required • Estimates of Supply Elasticity
dwellings • For each component of the housing bundle,
there's a price
14-44
14-55
Results of Other Hedonic Studies
• Positive influence: proximity to jobs, schools, transit ns, churches
• Is it efficient for low-income households to live in used housing?
• Who benefits from subsidies for new housing? • How do growth controls affect the housing
– Move to vacated dwelling: move up quality ladder
14-2200
Effects of Growth Controls [Building Ban]
• Direct effect on high-income: tolerate mismatch or incur high upgrade costs
– Ozanne & Struyk: 10-year elasticity for used housing = 0.20 to 0.30
– DeLeeuw & Ekanem: Long-run elasticity for rental housing = 0.30 to 0.70
14-1133
Moving Costs and Consumer Disequilibrium
14-1188
14-1199
Filtering with Rising Income
• Increase in income increases demand for housing quality
• Larger advantage of filtering process
– Remain in old dwelling: costly upgrade (renovate/remodel) to higher level
• Abandon when Income < Property tax • A flexible property tax declines with income,
prolonging use • New York: Elasticity(abandonment, property tax) =
– Increase the quantity of new dwellings (2-3 percent per year)
– Increase maintenance on used dwellings – Remodel and renovate used dwellings
14-1122
Supply is Relatively Inelastic for Long Periods
• Figure 14-4-B: Decrease in housing quality causes mismatch
14-1144
14-1155
Filtering and the Housing Stepladder
• Over time quality of dwelling decreases • Response to decrease in quality
14-2244
14-2255
• Market interactions generate higher prices for all types of housing
14-2222
Step 1: High-Quality Submarket
14-2233
Step 2: Supply Effects on Medium-Quality Submarket
• No filtering to middle-income household: tolerate mismatch or costly upgrade
• No filtering to low-income household: tolerate mismatch or costly upgrade
• Large expense for remodel & renovate to raise level
14-77
14-88
14-99
Retirement Scenarios
• Boarding up: short-lived reduction in price; low opportunity cost of funds
• Large moving cost: move possessions and detach from neighborhood
• Households tolerate mismatch until large enough to justify a move
• Figure 14-4-A: Increase in income causes mismatch
• Negative effects: crime, toxic waste, noisy highways
14-66
Housing Quality Ladder
• Normal deterioration moves dwelling down the ladder
• Moderate expense: keep dwelling at same level
Chapter 14
Why Is Housing Different?
Why is Housing Different?
• Heterogeneous: dwellings differ in size, age, style, features, location
• Durable: Deterioration rate depends on maintenance and repair decisions
14-1166
14-1177
What About the Highest Quality Housing?
• Filtering doesn't always work: Some features don’t filter downward
• Wealthiest households remain in highest quality houses
• Conversion: Profit from alternative > Conversion cost
• Abandonment: Profit from alternative < Conversion cost
14-1100
Abandonment and Public Policy
• Declining income from property and constant property tax
• Costly Moving: Adjustment when gap between ideal and actual large
14-22
Questions to Address
• Why do we care about heterogeneity, durability, and moving costs?
market?
14-33
Hedonic Pricing Approach
• Each dwelling has a different bundle of characteristics
• Dwelling features: quality, age, size • Neighborhood effects: quality of other
• Result: cost of building ban borne by everyone in market
14-2211
Price Effects of Growth Controls
• How does ban on new housing (high quality) affect housing prices?
fashion – Used house filtered down from higher level
• Filtering: Income level of occupant decreases over time
1.65 • Externalities from abandoned buildings: Eyesores
and crime havens
14-1111
Durability and Supply Elasticity
• Increase in price of housing increases quantity supplied
• Most of the stock (97% - 98%) is used • Rate of deterioration relatively slow • Upgrading (Remodel & renovate) costly, so large
price hike required • Estimates of Supply Elasticity
dwellings • For each component of the housing bundle,
there's a price
14-44
14-55
Results of Other Hedonic Studies
• Positive influence: proximity to jobs, schools, transit ns, churches
• Is it efficient for low-income households to live in used housing?
• Who benefits from subsidies for new housing? • How do growth controls affect the housing
– Move to vacated dwelling: move up quality ladder
14-2200
Effects of Growth Controls [Building Ban]
• Direct effect on high-income: tolerate mismatch or incur high upgrade costs
– Ozanne & Struyk: 10-year elasticity for used housing = 0.20 to 0.30
– DeLeeuw & Ekanem: Long-run elasticity for rental housing = 0.30 to 0.70
14-1133
Moving Costs and Consumer Disequilibrium
14-1188
14-1199
Filtering with Rising Income
• Increase in income increases demand for housing quality
• Larger advantage of filtering process
– Remain in old dwelling: costly upgrade (renovate/remodel) to higher level
• Abandon when Income < Property tax • A flexible property tax declines with income,
prolonging use • New York: Elasticity(abandonment, property tax) =
– Increase the quantity of new dwellings (2-3 percent per year)
– Increase maintenance on used dwellings – Remodel and renovate used dwellings
14-1122
Supply is Relatively Inelastic for Long Periods
• Figure 14-4-B: Decrease in housing quality causes mismatch
14-1144
14-1155
Filtering and the Housing Stepladder
• Over time quality of dwelling decreases • Response to decrease in quality
14-2244
14-2255
• Market interactions generate higher prices for all types of housing
14-2222
Step 1: High-Quality Submarket
14-2233
Step 2: Supply Effects on Medium-Quality Submarket
• No filtering to middle-income household: tolerate mismatch or costly upgrade
• No filtering to low-income household: tolerate mismatch or costly upgrade
• Large expense for remodel & renovate to raise level
14-77
14-88
14-99
Retirement Scenarios
• Boarding up: short-lived reduction in price; low opportunity cost of funds
• Large moving cost: move possessions and detach from neighborhood
• Households tolerate mismatch until large enough to justify a move
• Figure 14-4-A: Increase in income causes mismatch
• Negative effects: crime, toxic waste, noisy highways
14-66
Housing Quality Ladder
• Normal deterioration moves dwelling down the ladder
• Moderate expense: keep dwelling at same level
Chapter 14
Why Is Housing Different?
Why is Housing Different?
• Heterogeneous: dwellings differ in size, age, style, features, location
• Durable: Deterioration rate depends on maintenance and repair decisions
14-1166
14-1177
What About the Highest Quality Housing?
• Filtering doesn't always work: Some features don’t filter downward
• Wealthiest households remain in highest quality houses
• Conversion: Profit from alternative > Conversion cost
• Abandonment: Profit from alternative < Conversion cost
14-1100
Abandonment and Public Policy
• Declining income from property and constant property tax
• Costly Moving: Adjustment when gap between ideal and actual large
14-22
Questions to Address
• Why do we care about heterogeneity, durability, and moving costs?
market?
14-33
Hedonic Pricing Approach
• Each dwelling has a different bundle of characteristics
• Dwelling features: quality, age, size • Neighborhood effects: quality of other
• Result: cost of building ban borne by everyone in market
14-2211
Price Effects of Growth Controls
• How does ban on new housing (high quality) affect housing prices?