Revisiting metropolitan house price-income relationships

Elias Oikarinen, Steven C. Bourassa, Martin Hoesli, Janne Engblom

Research output: Contribution to journalArticlepeer-review


We explore long-term patterns of the house price-income relationship across the 70 largest U.S. metropolitan areas. In line with a standard spatial equilibrium model, our empirical findings indicate that regional house price-income ratios are typically not stable, even over the long run. In contrast, panel regression models that relate house prices to aggregate personal income and allow for regional heterogeneity yield stationary long-term relationships in most areas. The house price-income relationship varies significantly across locations, underscoring the importance of using estimation techniques that allow for spatial heterogeneity. The substantial regional differences are closely related to the elasticity of housing supply.
Original languageEnglish
Article number101946
JournalJournal of Housing Economics
Early online date23 May 2023
Publication statusE-pub ahead of print - 23 May 2023


  • house prices
  • personal income
  • Spatial equilibrium
  • regional heterogeneity
  • supply elasticity


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