Abstract

This paper studies the impact of foreclosures on house prices in Italy using a large dataset of listings. We estimate that the foreclosure discount is considerable, and this would suggest a high degree of market segmentation and limited spillovers from foreclosures to the market for non-foreclosed homes. However, we find that the entry of foreclosures into the market increases the propensity of home sellers to adjust their list price. Moreover, foreclosure listings have a significant and negative impact on the prices of non-foreclosed homes nearby. Our evidence is quantitatively consistent with the recent literature on the impact of foreclosures on the US housing market.

Full Text
Published version (Free)

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call