Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/240687 
Year of Publication: 
2019
Series/Report no.: 
Working Papers No. 2019-19
Publisher: 
Banco de México, Ciudad de México
Abstract: 
This work studies the impact of Foreign Direct Investment (FDI) and portfolio flows on house prices of emerging market economies using a static factors panel VARX model. The results show that an increase in both FDI and portfolio flows leads to higher house prices, but that portfolio flows have a more persistent effect. This work also finds that mortgage credit, as proxy of housing demand, is an important variable in house price dynamics in the sense that it has a higher positive impact on house prices than any of the other endogenous variables included. The results are robust to different specifications of the model, such as adding additional lags or changing the order in which the endogenous variables enter the model.
Subjects: 
Emerging Markets
Capital Flows
House Prices
JEL: 
C32
E44
F32
G21
Document Type: 
Working Paper
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