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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