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| The Honeycomb Cycle in Real Estate Author: Jos Janssen, Bert Kruijt, and Barrie Needham Start Page: 237 Abstract: A change in market
conditions can trigger a cyclical response in the housing market, a cycle in both prices
and number of transactions. This is caused not only by production lags but also by the
reactions of buyers and sellers. The fact that many buyers are also sellers, and vice
versa, has a special effect on this cycle. In this paper a theory of this cycle in prices
and transactions is developed and empirically tested. It is found that volume changes are
much more closely related statistically to changes in market conditions that are price
changes. A clear cycle is found in two of the four towns studied. |
