2.0

BACKGROUND STUDIES

Key indicators related to housing and mortgage demand include the following:

  Housing price (rent, selling prices (existing/new), hedonic prices, and price of

other goods)

  Dwellings

  Households/dwellings

  Floor area per person (distribution)

  Infrastructure adequacy (distribution)

  Construction

  Construction per 1,000 households

  Investment

  Investment/GDP

  Outstanding mortgage credit

  Number of outstanding mortgages

  New mortgages credit

  New mortgages

  Loan to value ratio on outstanding mortgages

  Loan to value ratio on new mortgages

  Terms (interest rate, term in years) of outstanding mortgages

  Terms (interest rate, term in years) of new mortgages

  Lending rates for other sectors, credit use:

   Consumer loans

   Import/export credits

   Enterprise loans

  Other background variables

  Consumer prices

  Prime lending rate

  Exchange rate

These and other indicators should be examined to establish basic trends and

distributional aspects of indicators.  Key indicators should then be compared to:

  Other transition economies

  Other countries at similar income levels

For a variety of reasons, it is not particularly fruitful for transition countries to

undertake comparisons with the United States or Western Europe.  Not only do income

and relative prices differ, the various barriers that cause the  gap  between potential and

effective demand, discussed below and in the main text, are likely to be much more

pronounced.  For a good policy related analysis of key housing indicators focusing on

Eastern Europe, and, in some cases, countries with comparable incomes, see Heged s,

Mayo, and Tosics (1996). 

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