How asymmetric are urban housing markets? Some worst cases

Abstract

The paper specifies a model of the urban housing market that includes the possibility of asymmetric responses to decreases and increases in housing demand. The model includes an occupancy rate and permits the number housing units to increase or decrease. The occupancy rate and the change in housing units are critical dependent variables. As predicted by the model, the empirical results for 1970 to 2010 show that the occupancy rate in declining central cities fell when population declined and increased when housing units were removed from the stock. The suburbs of those same central cities experienced fairly smooth expansions of the housing market with only small variations in occupancy rates.