Wharton-SMU Research Center

In-House Seminar

Guest Speaker:

Susan M. Wachter
Richard B. Worley Professor Financial Management; Professor of Real Estate, Finance and City and Regional Planning, The Wharton School, University of Pennsylvania.

Date & Venue:
Date: 21 July 2005, Thursday
Time: 4.00pm-5.45pm
Venue: School of Economics & Social Sciences, Level 5, Seminar Room SR5.1
Singapore Management University
90 Stamford Road, Singapore 178903
(Location Map) Please note our new campus address.

Topic:
The Global Housing Boom

About the Seminar:
The current housing boom is a global phenomenon and a by-product of the globalization of financial markets. Price rises are fueled by a world-wide increase in the availability of credit to finance house purchases. In turn, the decline in mortgage rates is the result of a global decline in interest rates that is proceeding in lock-step across much of the industrialized world. Rates have been decreasing since the 1980s; the decrease accelerated in the 1990s; and, especially strikingly, decreased even more, after the recession of 2000 -2001, when rates would be expected to rise. While global market fundamentals are clearly at work in explaining price rises, we show how region-specific conditions of supply inelasticity can increase the likelihood of bubble formation and, even in the absence of bubbles, high “betas” and volatility. The rise in prices is worrisome because it is occurring in so many countries at the same time. Wealth declines when markets shift and housing prices fall are likely to cause synchronized declines in demand across markets. Moreover, we show that the increasing prevalence of markets with supply constraints and the worldwide nature of the financial and mortgage market liberalization that are contributing to the global surge in house prices are also likely to exacerbate price declines when market conditions shift.

Registration:
This seminar is free. Please register early. (Admission on a first-come-first-served basis.)
For registration, please click here

Enquiries:
Ms. Lim Lih Yeng, lylim@smu.edu.sg, Tel: 68220197
Ms. Priscilla Cheng, priscillacheng@smu.edu.sg, Tel: 68220383