The Housing Market(s) of San Diego

Tim Landvoigt, Monika Piazzesi, Martin Schneider

NBER Working Paper No. 17723
Issued in January 2012
NBER Program(s):   AP   EFG   ME

This paper uses an assignment model to understand the cross section of house prices within a metro area. Movers' demand for housing is derived from a lifecycle problem with credit market frictions. Equilibrium house prices adjust to assign houses that differ by quality to movers who differ by age, income and wealth. To quantify the model, we measure distributions of house prices, house qualities and mover characteristics from micro data on San Diego County during the 2000s boom. The main result is that cheaper credit for poor households was a major driver of prices, especially at the low end of the market.

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This paper was revised on January 23, 2012

Acknowledgments and Disclosures

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