Mizuno M & Tabner I (2011) The Margin of Safety and Turning Points in House Prices: Observations from Three Developed Markets. SSRN Working Paper Series, 1861448. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1861448
Using quarterly data from 1960 (United Kingdom), 1963 (United States), and 1977 (Japan) through the second quarter (Q2) of 2010 (all three markets), the authors examined long-run mean-reverting relationships between house prices and inflation, disposable income, GDP, and rents. At the end of Q2 2010, U.S. prices were below their mean-reverting levels and at the lower end of their historical range. Equivalent U.K. and Japanese prices were at or slightly above their mean-reverting levels.
Economics; Aggregate Demand and Aggregate Supply; Expectations and Economic Policy; Business Cycles; Widely-Used Measures of Economic Activity; Market Forces of Supply and Demand; Elasticity