The housing market: the impact of macroprudential measures in France
Labonne, Claire; Lecat, Rémy; Avouyi-Dovi, Sanvi (2014), The housing market: the impact of macroprudential measures in France, Financial stability review, 18, p. 195-206
TypeArticle accepté pour publication ou publié
Journal nameFinancial stability review
Banque de France
MetadataShow full item record
Abstract (EN)The housing market is a central macroprudential policy concern in France due to the significant proportion of residential property loans in bank balance sheets and the high weight of housing in household wealth. The surge in house prices at the start of the 2000s means we cannot rule out the risk of a bubble or a sharp downward correction, even though prices currently seem to be stabilising. However, if the evolution of house prices does start to pose a threat to financial stability, French authorities have access to a number of macroprudential tools that can be used to modify trends in factors such as the provision of housing loans. Using a model, this article attempts to examine the impact of measures which directly or indirectly influence loan interest rates and maturities, or the size of repayments in relation to household income. The empirical results show that these measures have a significant impact on trends in home lending, but a more limited impact on house prices due to the way variations in lending affect housing supply.
Subjects / KeywordsMortgage loans; Housing; Cost and standard of living; Real estate business
JELE64 - Incomes Policy; Price Policy
E63 - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
E01 - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
D91 - Intertemporal Household Choice; Life Cycle Models and Saving
D31 - Personal Income, Wealth, and Their Distributions
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