TY  - JOUR
AU  - Warnock,Veronica Cacdac
AU  - Warnock,Francis E.
TI  - Markets and Housing Finance
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 13081
PY  - 2007
Y2  - May 2007
UR  - http://www.nber.org/papers/w13081
L1  - http://www.nber.org/papers/w13081.pdf
N1  - Author contact info:
Veronica Cacdac Warnock
Darden Business School
University of Virginia
Box 6550
Charlottesville, VA 22906-6550
Tel: 434-243-2342
E-Mail: vwarnock@virginia.edu

Francis E. Warnock
Darden Business School
University of Virginia
Charlottesville, VA 22906-6550
Tel: 434/924-6076
Fax: 434/243-8945
E-Mail: warnockf@darden.virginia.edu
AB  - We examine the extent to which markets enable the provision of housing finance across a wide range of countries. Housing is a major purchase requiring long-term financing, and the factors that are associated with well functioning housing finance systems are those that enable the provision of long-term finance. Across all countries, controlling for country size, we find that countries with stronger legal rights for borrowers and lenders (through collateral and bankruptcy laws), deeper credit information systems, and a more stable macroeconomic environment have deeper housing finance systems. These same factors also help explain the variation in housing finance across emerging market economies. Across developed countries, which tend to have low macroeconomic volatility and relatively extensive credit information systems, variation in the strength of legal rights helps explain the extent of housing finance. We also examine another potential factor--the existence of sizeable government securities markets--that might enable the development of emerging markets' housing finance systems, but we find no evidence supporting that.
ER  -