Adjustments in the Labor and Real Estate Markets: Estimates of the Time Series Variation in the Natural Vacancy Rate

Angela J. Black, Steven Devaney, Patric Henry Hendershott, Bryan D. MacGregor* (Corresponding Author)

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

Large similarities exist between the labor and real estate space markets. The natural rate of unemployment (NRU) and the natural vacancy rate (NVR) are important in modeling these markets. The real estate literature has drawn on early modeling of the labor market and has predominantly assumed the NVR to be constant in time. We consider a range of approaches to estimate cross-sectional and time variation in the NVR for the US office market. The results provide no evidence for a time trend, but the NVR may still vary temporally although it is difficult to identify plausible and consistent variation.
Original languageEnglish
JournalJournal of Real Estate Literature
Publication statusAccepted/In press - 27 Jul 2021

Keywords

  • Natural Vacancy Rate
  • Natural Rate of Unemployment
  • Office Markets

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