Abstract:
This paper investigates the US housing market from just before the Great Recession onward (2006-2019) and assesses the viability of stock-flow matching in generating the observed outcomes. The paper documents that the probability a house sells declines sharply after listing for two weeks. Moreover, the probability and associated price of a fast sale recover from the housing slump sooner, faster, and more prominently than slower sales. The simulated stock-flow matching model can not only mimic sales, prices, listings, and time-on-market but also capture the distinctions in quick and slower trades, indicating the importance of stock-flow matching for understanding housing market dynamics.
