Macro-economic indicators and housing price index in Spain: fresh evidence from FMOLS and DOLS
International Journal of Housing Markets and Analysis
ISSN: 1753-8270
Article publication date: 20 September 2023
Issue publication date: 16 January 2025
Abstract
Purpose
This study aims to determine how changes in macroeconomic indicators and the housing prices index (HPI) are related. These factors can cause short-term and long-term changes in the housing market in Spain.
Design/methodology/approach
The study used cointegrating regression, fully modified ordinary least squares and dynamic ordinary least squares methodologies. The models are trained using quarterly time series data for these parameters from 2010 to 2022. A comprehensive examination is conducted to explore the relationship between macroeconomic issues and fluctuations in the HPI.
Findings
The results indicate statistically significant short-run effects (p < 0.05) of economic growth, inflation, Spanish stock indices, foreign trade and the interest rate on HPI. The inflation variables, Spain’s stock indices, interest rate and monetary rate, have statistically significant long-run effects (p < 0.05) on HPI. The exchange rate, unemployment and money supply have no substantial impact on HPI in Spain.
Originality/value
The study’s findings significantly contribute to increased information concerning the level of investing activity in the Spanish housing sector. After conducting an in-depth study of both the long-run and short-run connections with HPI, the study proved to be highly effective in formulating appropriate policies.
Keywords
Acknowledgements
Author contribution: AR and LA: Conceptualization, Methodology, Formal analysis, Writing Original Draft. TT and MS: Data Curation, Writing Original Draft, Writing. GEB: Review and Editing, Investigation.
Funding: None, no fund received.
Data availability: The sources of data have been duly mentioned in the study.
Declarations of interest: None, no conflict of interest.
Acknowledgments: None, no fund received.
Ethical approval: This article does not contain any studies with human participants performed by any of the authors.
Consent for publication: Not applicable.
Consent to publish: Not applicable.
Citation
Raza, A., Asif, L., Türsoy, T., Seraj, M. and Erkol Bayram, G. (2025), "Macro-economic indicators and housing price index in Spain: fresh evidence from FMOLS and DOLS", International Journal of Housing Markets and Analysis, Vol. 18 No. 1, pp. 227-248. https://doi.org/10.1108/IJHMA-07-2023-0094
Publisher
:Emerald Publishing Limited
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