@techreport{NBERw5179,
 title = "Expectations, Efficiency, and Euphoria in the Housing Market",
 author = "Dennis R. Capozza and Paul J. Seguin",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "5179",
 year = "1995",
 month = "July",
 URL = "http://www.nber.org/papers/w5179",
 abstract = {This paper studies expectations of capital appreciation in the housing market.  We show that expectations impounded in the rent/price ratio at the beginning of the decade successfully predict appreciation rates, but only if we first control for cross-sectional differences in the quality of rental versus owner-occupied housing.  We also demonstrate that observed rent/price ratios contain a disequilibrium component that also has power to forecast subsequent appreciation rates.  Finally, we provide evidence consistent with euphoria: participants in housing markets appear to overreact to income growth.},
}