Publication

This paper attempts to show that the Euro zone faces a similar problem as the downturn in the US housing market, which has, according to the author, attracted a lot of attention and has sparked a global financial crisis. The paper also presents a composite indicator for housing prices in the euro area. The author then provides a long-term comparison between the US and the euro area indicators and discusses briefly the macroeconomic consequences of a sustained boom (and bust) in housing prices. In conclusion, the paper speculates about the possible timing of the expected turning point in euro area housing markets.