Real-estate bubble: Difference between revisions

Bubbles in housing markets are more critical than [[stock market bubble]]s. Historically, [[Equity (finance)|equity]] price busts occur on average every 13 years, last for 2.5 years, and result in about a 4 percent loss in [[Gross domestic product|GDP]]. Housing price busts are less frequent, but last nearly twice as long and lead to output losses that are twice as large ([[International Monetary Fund|IMF]] World Economic Outlook, 2003). A recent laboratory experimental study<ref>Ikromov, Nuridding and Abdullah Yavas, 2012a, "Asset Characteristics and Boom and Bust Periods: An Experimental Study". ''Real Estate Economics''. 40, 508–535.</ref> also shows that, compared to financial markets, [[Real estate market|real estate markets]] involve more extended boom and bust periods. Prices decline slower because the real estate market is less liquid.

 

 

==Identification and prevention==